/raid1/www/Hosts/bankrupt/TCR_Public/090318.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, March 18, 2009, Vol. 13, No. 76
Headlines
750 JEFFERSON: Voluntary Chapter 11 Case Summary
1000 VIRGINIA: Voluntary Chapter 11 Case Summary
ABITIBIBOWATER INC: Moody's Affirms 'Caa3' Corporate Family Rating
ABITIBI-CONSOLIDATED CO: S&P Cuts Sr. Unsec. Debt Rating to 'C'
ABITIBI-CONSOLIDATED INC: S&P Cuts Corp. Credit Rating to 'CC'
ADT CONSTRUCTION: U.S. Trustee Wants Case Converted to Ch. 7
ALCOA INC: Aims to Trim Costs by $2.4BB, Boost Cash in Offerings
ALLIANCE PAYMENT: Voluntary Chapter 11 Case Summary
AMERICAN INT'L: $165MM Bonuses Spur Outrage; Obama to Block Payout
AMERICAN INT'L: To Pay $62BB to Settle Derivative Transactions
ANDERSON HOMES: Case Summary & 20 Largest Unsecured Creditors
ANDERSON NEWS: Fails in Effort at Interim Trustee Appointment
ANTHONY REITANO: Voluntary Chapter 11 Case Summary
ARBIOS SYSTEMS: Sets Chapter 11 Plan; Energex to Get 90% of Equity
ATLAS PIPELINE: Moody's Reviews 'B1' Rating for Possible Cut
AVENTINE RENEWABLE: Moody's Cuts Corporate Family Rating to 'Ca'
BALLY TOTAL: Gets Court Okay to Hire BDO Seidman as Auditors
BALLY TOTAL: Panel Gets Permission to Hire Akin Gump as Counsel
BALLY TOTAL: Panel Gets Court OK to Tap FTI as Financial Advisors
BALLY TOTAL: Affiliates File Schedules and Statements
BARRIAN PRECISION: Voluntary Chapter 11 Case Summary
BEARINGPOINT INC: Cash Collateral Order Revised on Panel Objection
BEL TRUST: Voluntary Chapter 11 Case Summary
BILTRITE RUBBER: Files for Bankruptcy in Canada and Toledo
BLOCKBUSTER INC: Wattles Buys 5.7% Stake Despite Bankruptcy Rumors
BOOTH MANUFACTURING: Voluntary Chapter 11 Case Summary
BRUNO'S SUPERMARKETS: Proposes Incentive Plan for 21 Managers
BUSINESS LOAN: Fitch Downgrades Ratings on Class M to 'BB'
CANNERY CASINO: Moody's Reviews Ratings on Crown Limited Merger
CANWEST MEDIA: Nonpayment of Interest Cues S&P's Rating Cut to D
CHEMTURA CORP: Adopts Executive and Key Employee Severance Plan
CHESAPEAKE CORP: To Sell Assets to Irving; Auction Cancelled
CHEYENNE KNIFE: Voluntary Chapter 11 Case Summary
CHRYSLER LLC: CEO Doubts Firm's Survival From Bankruptcy
CHRYSLER LLC: Seeks to Cut Canadian Workers' Pay by 25%
CITATION CORP: Aluminum Die Casting Unit Sold to Compass
CITIGROUP INC: Lewis Alexander Leaves Co. to Join Treasury Dept.
CITIGROUP INC: CEO Pandit Got $1MM Salary, $37MM Stock in 2008
CITY OF VALLEJO: Can Terminate Union Contracts, Court Rules
COLEMAN CABLE: S&P Gives Negative Outlook, Affirms 'BB-' Ratings
CONSECO INC: Delays Filing of Annual Report on Form 10-K
COOPER COAL: Voluntary Chapter 11 Case Summary
CRC3 INC: Voluntary Chapter 11 Case Summary
CYNTHIA IANNARELLI: Voluntary Chapter 11 Case Summary
DANIEL INIGUEZ: Voluntary Chapter 11 Case Summary
DARROW AUTOMOTIVE: Sent to Ch. 7 Liquidation by 4 Creditors
DAYTON SUPERIOR: Maturity of $250MM in Loans Moved to March 23
DAYTON SUPERIOR: Extends Debt Exchange Offer Until April 9
DEGROATE PETROLEUM: Voluntary Chapter 11 Case Summary
DOLE FOOD: Fitch Upgrades Long Term IDR to 'CCC'
DOLPHIN ISLAND: Voluntary Chapter 11 Case Summary
ECONOMIC INVENTIONS: Voluntary Chapter 11 Case Summary
EMPLOYMENT GIANT: Voluntary Chapter 11 Case Summary
ENERGY PARTNERS: S&P Downgrades Corporate Credit Rating to 'CCC-'
ENERGY XXI: S&P Changes Outlook to Negative; Affirms 'B-' Rating
EQUAN REALTY: Court OKs Gregory Messer as Chapter 11 Trustee
EZRI NAMVAR: Namco Capital Owes $545 Million to 464 Creditors
FABTECH INDUSTRIES: Voluntary Chapter 11 Case Summary
FANNIE MAE: Barney Frank to Submit Bill for Co.'s Restructuring
FREDDIE MAC: Barney Frank to Submit Bill for Co.'s Restructuring
FORUM HEALTH: Files for Chapter 11 Bankruptcy in Ohio
FORUM HEALTH: Wants Access to Secured Lenders Cash Collateral
FRANK & CAMILLE: Voluntary Chapter 11 Case Summary
FREEDOM VENTURES: Voluntary Chapter 11 Case Summary
FREEPORT-MCMORAN COPPER: Fitch Affirms 'BB' Preferred Stock Rating
GENERAL MOTORS: CEO Changes Stance on Firm's Possible Bankruptcy
GENERAL MOTORS: Complete Separation of Opel From Firm Impossible
GENERAL MOTORS: Will Temporarily Shut Midsize-Car Plant
GENTA INC: To Pay Note Holders in Kind in Lieu of Cash
GEORGE MELC: Voluntary Chapter 11 Case Summary
GOLD COUNTRY: Voluntary Chapter 11 Case Summary
GOLDEN CENTURY: Voluntary Chapter 11 Case Summary
GONZALO MARTINEZ: Voluntary Chapter 11 Case Summary
GOODY'S LLC: Proposes Bonuses for Executives and Other Employees
GOTTSCHALKS INC: Liquidators JV is Lead Bidder; Auction March 30
HARRAH'S ENTERTAINMENT: Owners May Retain Control After Bankruptcy
HAWAIIAN TELCOM: Court Exclusivity Extension Shorter by 1 Month
HAYES LEMMERZ: Determines Erratic Financial Report from 2006-2008
HEARST CORP: Seattle Post-Intelligencer Ends Print Edition
HELEN JEAN COOLEY: Voluntary Chapter 11 Case Summary
HELLER EHRMAN: Court Sets April 27 General Claims Bar Date
HOVNANIAN ENTERPRISES: Difficult Market Cues Fitch's Junk Rating
INDEPENDENT BANK: Moody's Withdraws 'D' Bank Strength Rating
INTERNATIONAL COAL: S&P Downgrades Corp. Family Rating to 'Caa2'
INTERSTATE HOTELS: NYSE Suspension Cues Moody's Junk Rating
INT'L COASTAL: Issued of $30MM Unlegended Shares; May File Bankr.
INVESTMENTS USA: Voluntary Chapter 11 Case Summary
IRWIN VICTOR AUTREY: Voluntary Chapter 11 Case Summary
JAMES THURSTON PATTERSON: Voluntary Chapter 11 Case Summary
JAMIE VERGARA: Wants Kosto & Rotella as Bankruptcy Counsel
JAWS II LLC: Voluntary Chapter 11 Case Summary
JERRY FITCH: Voluntary Chapter 11 Case Summary
JKMD INVESTMENTS: Voluntary Chapter 11 Case Summary
KEITH PICKLE: Voluntary Chapter 11 Case Summary
LEHMAN BROTHERS: Broker Dealers Given First Priority Liens
LEHMAN BROTHERS: Court Approves LCPI & LBHI Letter Agreements
LEHMAN BROTHERS: Can Hire Huron Consulting as Tax Advisors
LEHMAN BROTHERS: Barclays Settle Disputes on Pacts to Be Assumed
LEHMAN BROTHERS: Turnberry Sues Bank Unit for Contract Breach
LEHMAN BROTHERS: Permitted to Repo With Bank Subsidiary
LEIGHTON CENTRE: Voluntary Chapter 11 Case Summary
LENOX GROUP: Court Defers Chapter 11 Plan Hearings and Deadlines
LEXINGTON PRECISION: Can Use Cash Collateral Until May 22
LEXINGTON PRECISION: Court Appoints Seymour Preston as Mediator
LOSEE & LONE: Voluntary Chapter 11 Case Summary
M. TANGREDI'S: CFO Indicted on Tax Evasion & Forgery Charges
MANASSEH BUILDING: Wants Access to PNC and FBBH Cash Collateral
MARCAL PAPER: Staples Withdraws Objection to Sale of Assets
MASHANTUCKET WESTERN: S&P Cuts Issuer Credit Rating to 'B+'
MASONITE INT'L: Plan Gets Bank Lenders & Bondholders Backing
MATTHEW GRAHAM MIGHELL: Voluntary Chapter 11 Case Summary
MGIC INVESTMENT: Moody's Cuts Senior Unsecured Debt Rating to 'B3'
MGM MIRAGE: Discussing Pledging Casinos to Avert Bankruptcy
MGM MIRAGE: Obtains Senior Credit Facility Waiver Through May 15
MIRABILIS VENTURES: Settles Forfeiture With U.S. Government
MYERS MILL: Court Okays G. Jeuter as Interim Trustee
NAILITE INT'L: Has $3MM DIP Loan; To Auction Assets on April 8
NAT'L SPORTS ATTRACTION: To Liquidate Under Chapter 7
PACIFIC ENERGY: Court Restricts Trading in Equity Interests
PHILADELPHIA NEWSPAPERS: Court Sets May 25 as Claims Bar Date
PHILADELPHIA NEWSPAPERS: DIP Financing Hearing Moved to March 31
PHILADELPHIA NEWSPAPERS: Has Until April 15 to File Schedules
POLAROID CORP: Former CEO Wants Sale Blocked, Seeks $7.2 Million
QIMONDA AG: Deadline to Find Investors Moved; Liquidation Looming
RAHMATOLLA MIZRAHI: Voluntary Chapter 11 Case Summary
RAILPOWER TECHNOLOGIES: Delays Filing of Financial Results
RETAIL PRO: Island Pacific Not Included in Bankruptcy Filing
SDM&C INVESTMENTS: Voluntary Chapter 11 Case Summary
SCHAWK INC: Evaluates Compliance with Credit Facilities
SEQUA CORP: Moody's Junks Rating on Exposure to Airlines, Big 3
SIX FLAGS: To Offer Debt-Equity Exchange Out of Court or in Ch. 11
SIX FLAGS: Fitch Downgrades Issuer Default Rating to 'C'
SPANSION INC: Delays Filing of Annual Report With SEC
SPANSION INC: Seeks to Hire KPMG As Financial Advisors
SPANSION INC: U.S. Trustee Appoints Unsecured Creditors Committee
SPANSION INC: Appoints Brincko as Chief Restructuring Officer
SPANSION INC: Retains John Brincko as Chief Restructuring Officer
ST. LAWRENCE HOMES: Seeks to Sell Homes in the Ordinary Course
ST. MARY'S HOSPITAL: Can Access $600,000 of HF-4 Cash Collateral
ST. MARY'S HOSPITAL: Wants to Hire Donlin Recano. as Claims Agent
ST. MARY'S HOSPITAL: Wants McCarter & English as Bankr. Counsel
STAR TRIBUNE: Reaches Settlement with Pressmen's Union
STRUCTURAL INVESTMENTS: Involuntary Chapter 11 Case Summary
S&K FAMOUS: Liquidator to Conduct GOB Sales at 30 of 136 Stores
TED WATTS: Case Summary & Six Largest Unsecured Creditors
TENET HEALTHCARE: Shares Info on Acctng. Treatment of New Notes
TENNESSEE STONE: Voluntary Chapter 11 Case Summary
THORNBURG MORTGAGE: Brings Kirkland and Houlihan Lokey on Board
THORNBURG MORTGAGE: In Talks With Lenders for Covenant Waivers
THORNBURG MORTGAGE: Lenders Agree to Forbearance Until March 31
THORNBURG MORTGAGE: Matlin and Patterson Step Down as Directors
TRIBUNE CO: Aims at Stopping ERISA Suit Versus Officers
TRIBUNE CO: To Negotiate One-Year Extension of $225MM Financing
TRIBUNE CO: Can Hire McDermott as Special Counsel
TRIBUNE CO: Gets Court OK to Hire Jones Day as Litigation Counsel
TRONOX INC: Shareholders Might Have Recovery, Says Report
TROPICANA ENTERTAINMENT: Dispute on 'Tropicana' Name Arises
TXCO Resources: Going Concern Doubt Raised; Warns of Bankruptcy
U-SAFE INVESTMENTS: Secured Creditors Object to Dismissal of Case
VERASUN ENERGY: Selects Valero's $477MM Bid for 7 Facilities
VISIPHOR CORP: Assets Sold, All Staff Laid Off
W.R. GRACE: District Court Drops N.J. Suit After Bar Date Missed
WASHINGTON MUTUAL: Claim Rejected by FDIC, Equity Group Says
WASHINGTON MUTUAL: Seeks Approval of Lease Rejection Guidelines
WASHINGTON MUTUAL: To Sell Venture Capital Stake for $3.1MM
WASHINGTON MUTUAL: Wants Insurers to Pay ERISA Suit Defense Costs
WENDY'S/ARBY'S GROUP: S&P Affirms 'B+' Corporate Credit Rating
WEST PENN: Moody's Affirms 'Ba3' Rating on $752 Mil. Bonds
WILLIAM TARSITANO: Case Summary & 19 Largest Unsecured Creditors
ZILA INC: Retains Advisors to Explore Options; Ch. 11 Possible
* S&P Says 125 Firms with $429.5-Bil. of Debt Defaulted in 2008
* S&P Says Global Defaults Increases to 40 as of Mid-March 2009
* Fitch Issues Rating Criteria for Categorizing Issuers
* Congress May Further Restrict Terms of Bail-Out
* Hearing Held on 210-Day Lease Assumption Rule
* Senate May Vote on Cramdown Bill This Month
* KKR Losses Show Failure to Close Gap Raising Defaults
* Peanut Recalls to Cost Producers $1 Billion
* Appeals Court Says Ch. 13 Trustee May Support Secured Creditor
* District Judge Says Civil Fines Not Barred by Automatic Stay
* Technicalities on Choice of Law on Homestead Exemption
* Upcoming Meetings, Conferences and Seminars
*********
750 JEFFERSON: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: 750 Jefferson Avenue LLC
1434 Collins Avenue #500
Miami Beach, FL 33139
Bankruptcy Case No.: 09-14451
Chapter 11 Petition Date: March 16, 2009
Court: Southern District of Florida (Miami)
Judge: Laurel M. Isicoff
Debtor's Counsel: Joel M. Aresty, Esq.
aresty@mac.com
13499 Biscayne Blvd., #T-3
No. Miami, FL 33181
Tel: (305) 899-9876
Fax: (305) 723-7893
The Debtor's financial condition as of March 15, 2009:
Total Assets: $16,000,000
Total Debts: $17,082,600
The Debtor did not file a list of 20 largest unsecured creditors.
The petition was signed by Michael A. Stern, managing member.
1000 VIRGINIA: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: 1000 Virginia Limited Partnership
1200 Washington Street
Wenatchee, WA 98801
Bankruptcy Case No.: 09-12009
Type of Business: The Company is a Single Asset Real Estate
debtor.
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of Washington (Seattle)
Judge: Samuel J. Steiner
Debtor's Counsel: Timothy W. Dore, Esq.
Ryan Swanson & Cleveland PLLC
1201 3rd Ave., Ste. 3400
Seattle, WA 98101-3034
Tel: (206) 464-4224
Email: dore@ryanlaw.com
Total Assets: $7,759,500.00
Total Debts: $6,624,562.36
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/wawb09-12009.pdf
The petition was signed by Donn Etherington, Jr., General Partner
of the company.
ABITIBIBOWATER INC: Moody's Affirms 'Caa3' Corporate Family Rating
------------------------------------------------------------------
Moody's Investors Service affirmed the Caa3 corporate family
rating and probability of default rating of AbitibiBowater Inc.'s
subsidiary Abitibi-Consolidated Inc. following the company's
proposal to recapitalize Abitibi. At the same time, Abitibi's
secured term loan, unsecured notes and speculative grade liquidity
ratings were affirmed at B2, Ca and SGL-4 respectively. The
rating outlook is negative.
AbitibiBowater is offering to exchange approximately $2.9 billion
of unsecured notes issued by Abitibi for conversion into
approximately $321 million of first lien notes, $810 million
second lien notes, 86.7 million shares of AbitibiBowater common
stock and 230.7 million warrants. If the transaction proceeds, it
will constitute a distressed exchange, which is an event of
default under Moody's definition of default. Moody's expect to
change the probability of default rating to Caa3/LD upon the
closing of the exchange offer. The company is also conducting a
concurrent offering of approximately $389 million of first lien
notes and a number of warrants. The exchange offer is subject to
a number of conditions. If approved, implementation of the
recapitalization is expected to occur by early May 2009.
The Caa3 corporate family ratings of AbitibiBowater's subsidiaries
Abitibi and Bowater Inc. reflect a heightened probability of
default in the near term. The ratings of both Abitibi and Bowater
also reflect the accelerating decline in demand for newsprint and
other paper grades manufactured by both companies as consumers
continue to migrate to online news and other forms of electronic
media. In addition, the company is also facing deteriorating
markets for their sawmill and market pulp operations. Despite
lower input costs, a weaker Canadian dollar and the company's
potential to realize additional synergies, Moody's does not expect
AbitibiBowater's operating performance to improve materially over
the next 12 to 18 months given the weak economic and industry
conditions. The negative outlook reflects expectations that the
company's liquidity challenges coupled with the deteriorating
economic and industry conditions will continue to put pressure on
the company's ratings.
Moody's last rating action was on January 20, 2009, when Abitibi's
and Bowater's corporate family rating was downgraded to Caa3 from
Caa1.
Headquartered in Montreal, Quebec, with a regional office in Greenville,
South Carolina, AbitibiBowater is North America's leader in
newsprint and commercial printing papers. Abitibi and Bowater are
separate legal entities and are the key operating subsidiaries of
AbitibiBowater, the publicly traded holding company.
ABITIBI-CONSOLIDATED CO: S&P Cuts Sr. Unsec. Debt Rating to 'C'
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on newsprint producer Abitibi-Consolidated Inc., a
subsidiary of AbitibiBowater Inc. (CC/Watch Neg/--), by one notch
to 'CC' from 'CCC-'.
At the same time, S&P lowered the senior unsecured debt ratings on
Abitibi-Consolidated and Abitibi-Consolidated Co. of Canada to 'C'
from 'CC', one notch below the corporate credit rating on Abitibi-
Consolidated. The recovery rating on each issue remains at '5',
reflecting modest (10%-30%) recovery in the event of default. In
addition, S&P lowered the secured debt ratings on Abitibi-
Consolidated Co. of Canada to 'CCC' from 'CCC+' (two notches above
the corporate credit rating on Abitibi-Consolidated). The
recovery ratings remain at '1', reflecting very high (90%-100%)
recovery in the event of default.
Finally, all the ratings on Abitibi-Consolidated Inc. remain on
CreditWatch with negative implications where they were placed
Feb. 10, 2009.
"The downgrade reflects our view that Abitibi-Consolidated's
recent distressed exchange offer is well below the principal
value," said Standard & Poor's credit analyst Jatinder Mall. S&P
will lower the corporate credit rating on Abitibi-Consolidated to
'SD' (selective default) and the affected issue ratings to 'D'
upon the exchange offer's completion.
The CreditWatch placement reflects S&P's uncertainty about the
completion of the exchange offer as it hinges on several
conditions being met including: court approval, completion of the
sale of the company's interest in Manicouagan Power Co.,
completion of recapitalization at sister company Bowater Inc., and
the closing of additional financing and amendments to convertible
notes at parent AbitibiBowater.
If the exchange offer succeeds, it will reduce Abitibi-
Consolidated's debt burden by about US$2.4 billion. Although the
exchange offer will alleviate the heavy debt burden, Standard &
Poor's believes the company will continue to face challenging
demand conditions for its products. Demand for newsprint has
declined sharply in recent months.
The company has also announced sale of hydro assets in Quebec,
which S&P believes will help it pay down secured debt and improve
liquidity.
Standard & Poor's will resolve the CreditWatch once Abitibi-
Consolidated completes the exchange offer. If the company is
unable to make payment on its upcoming US$350 million secured loan
due March 31, Standard & Poor's will lower the ratings to 'D'.
Abitibi-Consolidated has received an interim order from the courts
and has stated that it will not pay principal and interest as
scheduled on upcoming debt maturities; it will address these
obligations in accordance with the terms of the plan of
arrangement.
ABITIBI-CONSOLIDATED INC: S&P Cuts Corp. Credit Rating to 'CC'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term corporate
credit rating on newsprint producer Abitibi-Consolidated Inc., a
subsidiary of AbitibiBowater Inc. (CC/Watch Neg/--), by one notch
to 'CC' from 'CCC-'.
At the same time, S&P lowered the senior unsecured debt ratings on
Abitibi-Consolidated and Abitibi-Consolidated Co. of Canada to 'C'
from 'CC', one notch below the corporate credit rating on Abitibi-
Consolidated. The recovery rating on each issue remains at '5',
reflecting modest (10%-30%) recovery in the event of default. In
addition, S&P lowered the secured debt ratings on Abitibi-
Consolidated Co. of Canada to 'CCC' from 'CCC+' (two notches above
the corporate credit rating on Abitibi-Consolidated). The
recovery ratings remain at '1', reflecting very high (90%-100%)
recovery in the event of default.
Finally, all the ratings on Abitibi-Consolidated Inc. remain on
CreditWatch with negative implications where they were placed
Feb. 10, 2009.
"The downgrade reflects our view that Abitibi-Consolidated's
recent distressed exchange offer is well below the principal
value," said Standard & Poor's credit analyst Jatinder Mall. S&P
will lower the corporate credit rating on Abitibi-Consolidated to
'SD' (selective default) and the affected issue ratings to 'D'
upon the exchange offer's completion.
The CreditWatch placement reflects S&P's uncertainty about the
completion of the exchange offer as it hinges on several
conditions being met including: court approval, completion of the
sale of the company's interest in Manicouagan Power Co.,
completion of recapitalization at sister company Bowater Inc., and
the closing of additional financing and amendments to convertible
notes at parent AbitibiBowater.
If the exchange offer succeeds, it will reduce Abitibi-
Consolidated's debt burden by about US$2.4 billion. Although the
exchange offer will alleviate the heavy debt burden, Standard &
Poor's believes the company will continue to face challenging
demand conditions for its products. Demand for newsprint has
declined sharply in recent months.
The company has also announced sale of hydro assets in Quebec,
which S&P believes will help it pay down secured debt and improve
liquidity.
Standard & Poor's will resolve the CreditWatch once Abitibi-
Consolidated completes the exchange offer. If the company is
unable to make payment on its upcoming US$350 million secured loan
due March 31, Standard & Poor's will lower the ratings to 'D'.
Abitibi-Consolidated has received an interim order from the courts
and has stated that it will not pay principal and interest as
scheduled on upcoming debt maturities; it will address these
obligations in accordance with the terms of the plan of
arrangement.
ADT CONSTRUCTION: U.S. Trustee Wants Case Converted to Ch. 7
------------------------------------------------------------
Sara L. Kistler, the acting United States Trustee for Region 17,
asks the U.S. Bankruptcy Court for the District of Nevada to
convert ADT Construction Group, Inc.'s bankruptcy case to a
Chapter 7 proceeding for "cause", pursuant to Sec. 1112(b) of the
Bankruptcy Code.
The acting U.S. Trustee relates that the Court required to pay
examiner fees in two instalments but the Debtor failed to pay
either instalment. The acting U.S. Trustee further states that
the Debtor has failed to timely file its December 2008 monthly
operating report.
Headquartered in Las Vegas, Nevada, ADT Construction Group Inc. --
http://www.adtconstruction.com/-- aka Advanced Demolition
Technologies offers full-service contracting services. The Debtor
filed for Chapter 11 protection on June 24, 2008, (Bankr. D. Nev.
Case No.: 08-16841). Jason A. Imes, Esq., and Lenard E.
Schwartzer, Esq., at Schwartzer & McPherson Law Firm represents
the Debtor in its restructuring efforts. The Debtor has total
assets of $11,202,109 and total debts of $7,411,364.
ALCOA INC: Aims to Trim Costs by $2.4BB, Boost Cash in Offerings
----------------------------------------------------------------
Alcoa Inc. has disclosed a series of operational and financial
actions to significantly improve the Company's cost structure and
liquidity. The operational actions will reduce costs by more than
$2.4 billion annually, reduce capital expenditures an additional
$1.0 billion in 2010, and improve working capital by $800 million
in 2009. The Company is reducing the quarterly common stock
dividend from $0.17 to $0.03 per share, saving more than $400
million annually, and launching a public offering of common stock
and convertible notes planned to yield proceeds of approximately
$1.1 billion.
"By taking quick and decisive actions, Alcoa has been able to stay
ahead of the evolving economic crisis," said Klaus Kleinfeld,
President and CEO of Alcoa. "Today's actions better prepare Alcoa
to manage through a prolonged downturn and position the Company
for the future. We believe that we now have in place the
strategic and operational fundamentals that will enable Alcoa to
emerge even stronger when the economy recovers."
Operational Initiatives
Alcoa has launched a new series of operational measures to enhance
the Company's 2009-2010 performance and improve the Company's cost
structure. The targeted results of these operational measures
are: by 2010, procurement efficiencies reducing costs by $2
billion annually and overhead rationalization, reducing costs by
$400 million annually; in 2009, working capital efficiency
initiatives yielding $800 million in cash improvements; and by the
second half of 2009, a 50% reduction of capital spending to a
sustaining level of $850 million annually. As previously
announced, the Company is exiting four mid and downstream
businesses and the Shining Prospect special purpose vehicle that
held shares in Rio Tinto with an expected yield of approximately
$1.1 billion in cash in connection with these two actions. These
initiatives, together with the dividend reduction and new
financings, will further strengthen Alcoa's balance sheet and
enhance its liquidity.
Dividend Reduction
Alcoa's Board of Directors is reducing the Company's quarterly
common stock dividend to $0.03 per share from $0.17 per share,
payable May 25, 2009, to shareholders of record at the close of
business May 8, 2009. The decision will preserve more than
$400 million of cash annually.
"Given the impact of the economy on Alcoa's capital structure, the
Board of Directors decided to reduce the dividend," said Mr.
Kleinfeld. "This decision was made after comparisons to peer
companies and consideration of the interests of our shareholders.
We are pleased to be able to continue Alcoa's record of paying a
dividend every quarter for the past 60 years."
New Financings
Alcoa plans to offer, subject to market and other conditions,
150 million shares of common stock in an underwritten registered
public offering. In connection with this offering, Alcoa intends
to grant the underwriters an over-allotment option with respect to
an additional 22.5 million shares of common stock. Based on the
closing price of Alcoa's common stock on the New York Stock
Exchange on March 13, 2009, the offering (without giving effect to
any exercise of the over-allotment option) is expected to result
in proceeds of approximately $850 million.
Alcoa also plans to offer, subject to market and other conditions,
$250 million aggregate principal amount of convertible notes due
2014 in a concurrent underwritten registered public offering. In
connection with this offering, Alcoa intends to grant the
underwriters an over-allotment option with respect to an
additional $37.5 million aggregate principal amount of convertible
notes. The convertible notes will be convertible at the holder's
option into shares of Alcoa common stock at a conversion rate to
be determined in connection with the pricing of the proposed
offering.
Neither the completion of the convertible notes offering nor the
completion of the common stock offering will be contingent on the
completion of the other. The Company intends to use the net
proceeds from the offerings to repay outstanding indebtedness
under its senior unsecured 364-day revolving credit facility. The
Company intends to use any remaining proceeds for general
corporate purposes.
About Alcoa
Alcoa Inc. -- http://www.alcoa.com/-- is the world leader in the
production and management of primary aluminum, fabricated aluminum
and alumina combined. Alcoa serves the aerospace, automotive,
packaging, building and construction, commercial transportation
and industrial markets, bringing design, engineering, production
and other capabilities of Alcoa's businesses to customers. In
addition to aluminum products and components including flat-rolled
products, hard alloy extrusions, and forgings, Alcoa also markets
Alcoa(R) wheels, fastening systems, precision and investment
castings, and building systems. The company operates in 34
countries and has been named one of the top most sustainable
corporations in the world at the World Economic Forum in Davos,
Switzerland.
As of September 30, 2008, Alcoa had $39.0 billion in total assets
and $21.2 billion in total liabilities.
As reported by the Troubled Company Reporter on February 17, 2009,
Moody's Investors Service downgraded Alcoa Inc's senior unsecured
ratings to Baa3 from Baa1, its short-term rating to Prime-3 from
Prime-2, its rating on its shelf registration for senior unsecured
debt to (P)Baa3 from (P)Baa1 and its preferred stock rating to Ba2
from Baa3. At the same time Moody's downgraded Alcoa Trust 1's
shelf registration rating for preferred stock to (P)Ba1 from
(P)Baa2. The rating outlook is stable.
ALLIANCE PAYMENT: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Alliance Payment Technologies, Inc.
302 S Milliken Ave, G-1
Ontario, CA 91761
Bankruptcy Case No.: 09-14205
Type of Business: Alliance is a bank servicing company.
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Central District of California (Riverside)
Judge: Meredith A. Jury
Debtor's Counsel: Thomas E. Kent, Esq.
Lee & Kent
915 Wilshire Blvd #2050
Los Angeles, CA 90036
Tel: 213-380-2828
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/cacb09-14205.pdf
The petition was signed by Paul G. Hook, CEO of the Company.
AMERICAN INT'L: $165MM Bonuses Spur Outrage; Obama to Block Payout
------------------------------------------------------------------
Jonathan Weisman, Sudeep Reddy, and Liam Pleven at The Wall Street
Journal report that President Barack Obama said that he would
block American International Group Inc.'s $165 million in bonuses
to employees.
Jennifer Malloy Zonnas at The Associated Press relates that AIG's
bonuses have caused an outrage on Capitol Hill. WSJ quoted
President Obama as saying, "This is a corporation that finds
itself in financial distress due to recklessness and greed. Under
these circumstances, it's hard to understand how derivative
traders at AIG warranted any bonuses, much less $165 million in
extra pay." According to WSJ, White House press secretary Robert
Gibbs told reporters, "The president asked -- specifically asked
his economic team to go back again and determine whether there was
any legal avenue with which to block these bonuses."
WSJ states that the $165 million is the latest installment of a
retention program that is slated to pay the unit's employees about
$450 million.
As reported by the Troubled Company Reporter on March 16, 2009,
AIG planned to pay about $450 million in bonuses to workers at its
financial products unit. The unit caused AIG massive losses and
was mainly responsible for the Company's collapse in 2008. AIG
CEO Edward Liddy said that he and Treasury Secretary Timothy
Geithner met to talk about "compensation arrangements" at the
financial products unit and AIG in general. The next payments to
the financial products unit were due on Sunday. Those payments
are in addition to $121.5 million in last year's incentive bonuses
that AIG will begin paying this month to about 6,400 of its
116,000 workers. AIG is also making over $600 million in
retention payments to over 4,000 employees. The three programs
could result in $1.2 billion in retention and bonus payments.
WSJ notes that AIG had previously paid $55 million, and an
additional $230 million is pending for this year. Mr. Liddy said
that AIG will "use best efforts" to cut the pending payments by
"at least 30%," WSJ states.
Irate E-Mails and Phone Calls
Sudeep Reddy and Naftali Bendavid at WSJ states that legislators
have received irate e-mails and phone calls, and security has been
beefed up at AIG as death threats and hate mail flooded employees'
mailboxes.
WSJ quoted Sen. Charles Schumer as saying, "We intend to do
everything in our power to prevent the payments from being made
and to recoup the payments that have already been made. We will
take this back and return it to its rightful owners, the American
taxpayers."
WSJ relates that Sen. Schumer and other senators sent a letter to
Mr. Liddy demanding that he try to renegotiate the bonuses.
According to the report, the senators said in the letter, "For a
company that would not exist anymore but for a $170 billion
taxpayer-funded rescue, it is simply morally unacceptable to spend
$165 million on bonus payments."
Jonathan Weisman, Naftali Bendavid, and Deborah Solomon at WSJ
reports that lawmakers moved to tax away almost all of the
$165 million in bonuses paid to AIG employees. According to WSJ,
legislators like Senate Finance Committee Chairperson Max Baucus
proposed to levy a special tax on the retention bonuses. WSJ
states that recipients of the bonuses include 11 persons who no
longer work at AIG. WSJ says that the lawmakers are calling for a
tax rate of 90% to 95%, with much of the remainder claimed by
state and local levies. The move was seen as an attempt to
pressure the executives into giving up their bonuses voluntarily,
according to the report.
Sen. Schumer and other lawmakers are threatening new taxes aimed
specifically at the bonuses paid, WSJ relates.
According to WSJ, the government is considering using an
executive-pay provision inserted into the recently passed stimulus
law that would let the Treasury Secretary claw back the payments
if they were "inconsistent with the purpose" of the Troubled Asset
Relief Program or "otherwise contrary to public interest."
Payments Made Friday
New York Attorney General Andrew Cuomo said at a news conference
Monday that AIG told him that the Company had already released the
bonuses on Friday, according to WSJ. Mr. Cuomo, says WSJ, has
subpoenaed AIG, seeking more information about the payments. The
report quoted an AIG spokesperson as saying, "We are in ongoing
contact with the attorney general and will respond appropriately
to the subpoena."
The payouts officially approved Friday couldn't be extracted from
their recipients without a legal fight that would cost the
taxpayers even more, WSJ relates, citing administration officials.
According to WSJ, the officials said that the government will
focus on making sure taxpayers recover the cost of the bonuses and
executive compensation at AIG would be restricted.
Administration officials also worry that taking too hard a line
with AIG and other companies could discourage top financial
experts and institutions from joining the government efforts to
fix the financial system. According to The TCR, Mr. Liddy warned
that AIG "cannot attract and retain the best and brightest
talent . . . if employees believe that their compensation is
subject to continued and arbitrary adjustment by the U.S.
Treasury."
The unit's books contain many transactions that are "difficult to
understand and manage. This is one reason replacing key traders
and risk managers would not be practical on a large scale," WSJ
states, citing AIG.
About American International
Based in New York, American International Group, Inc. (AIG), is
the leading international insurance organization with operation in
more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the
most extensive worldwide property-casualty and life insurance
networks of any insurer. In addition, AIG companies are leading
providers of retirement services, financial services and asset
management around the world. AIG's common stock is listed on the
New York Stock Exchange, as well as the stock exchanges in Ireland
and Tokyo.
During the third quarter of 2008, requirements to post collateral
in connection with AIG Financial Products Corp.'s credit default
swap portfolio and other AIGFP transactions and to fund returns of
securities lending collateral placed stress on AIG's liquidity.
AIG's stock price declined from $22.76 on September 8, 2008, to
$4.76 on September 15, 2008. On that date, AIG's long-term debt
ratings were downgraded by Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., Moody's Investors Service and Fitch
Ratings, which triggered additional requirements for liquidity.
These and other events severely limited AIG's access to debt and
equity markets.
On September 22, 2008, AIG entered into an $85 billion revolving
credit agreement with the Federal Reserve Bank of New York and,
pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000
shares of Series C Perpetual, Convertible, Participating Preferred
Stock to a trust for the benefit of the United States Treasury.
At September 30, 2008, amounts owed under the facility created
pursuant to the Fed Credit Agreement totaled $63 billion,
including accrued fees and interest.
Since September 30, AIG has borrowed additional amounts under the
Fed Facility and has announced plans to sell assets and businesses
to repay amounts owed in connection with the Fed Credit Agreement.
In addition, subsequent to September 30, 2008, certain of AIG's
domestic life insurance subsidiaries entered into an agreement
with the NY Fed pursuant to which the NY Fed has borrowed, in
return for cash collateral, investment grade fixed maturity
securities from the insurance subsidiaries.
On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through
its Troubled Asset Relief Program, $40 billion of newly issued AIG
perpetual preferred shares and warrants to purchase a number of
shares of common stock of AIG equal to 2% of the issued and
outstanding shares as of the purchase date. All of the proceeds
will be used to pay down a portion of the Federal Reserve Bank of
New York credit facility. The perpetual preferred shares will
carry a 10% coupon with cumulative dividends.
AIG and the Fed also agreed to revise the existing FRBNY credit
facility. The loan terms were extended from two to five years to
give AIG time to complete its planned asset sales in an orderly
manner. The equity interest that taxpayers will hold in AIG,
coupled with the warrants, will total 79.9%.
At September 30, 2008, AIG had $1.022 trillion in total
consolidated assets and $950.9 billion in total debts.
Shareholders' equity was $71.18 billion, including the addition of
$23 billion of consideration received for preferred stock not yet
issued.
The Troubled Company Reporter reported on March 4, 2009, that
Moody's Investors Service confirmed the A3 senior unsecured debt
and Prime-1 short-term debt ratings of American International
Group, Inc. AIG's subordinated debt rating has been downgraded to
Ba2 from Baa1. The rating outlook for AIG is negative. This
rating action follows AIG's announcement of net losses of
$62 billion for the fourth quarter and $99 billion for the full
year of 2008, along with a revised restructuring plan supported by
the US Treasury and the Federal Reserve. This concludes a review
for possible downgrade that was initiated on September 15, 2008.
AMERICAN INT'L: To Pay $62BB to Settle Derivative Transactions
--------------------------------------------------------------
American International Group Inc. said in a filing with the U.S.
Securities and Exchange Commission that the Company and Maiden
Lane III, a vehicle created by the U.S. Federal Reserve to bail
out the Company, will pay $62 billion to settle derivative
transactions with 16 investment banks
According to AIG's filing, the Company and Maiden Lane will get in
return securities whose market value had dropped below
$30 billion.
Bhattiprolu Murti at The Wall Street Journal reports that AIG and
Maiden Lane previously disclosed their plan to settle the
Company's credit default swaps. Details related to the
derivatives' value and the amounts paid to settle obligations to
each counterparty weren't disclosed.
According to WSJ, Societe Generale and Goldman Sachs were the
biggest beneficiaries. AIG said in the SEC filing that Societe
Generale held derivative contracts with a notional value of about
$16.4 billion, but a negative mark-to-market of $8.4 billion.
That company, according to AIG disclosures, initially got almost
$9.6 billion as collateral from AIG, while Maiden Lane made up the
difference of almost $6.9 billion. WSJ relates that Goldman Sachs
held derivative contracts with a notional value of
$14 billion but a negative mark-to-market of $8 billion. WSJ
states that AIG posted collateral of $8.4 billion and Maiden Lane
added $5.6 billion to make up the difference.
WSJ said that Maiden Lane paid a total of more than $27 billion to
settle the derivative contracts. AIG said in its disclosure that
AIG Financial Products received an additional $2.5 billion from
Maiden Lane.
About American International
Based in New York, American International Group, Inc. (AIG), is
the leading international insurance organization with operation in
more than 130 countries and jurisdictions. AIG companies serve
commercial, institutional and individual customers through the
most extensive worldwide property-casualty and life insurance
networks of any insurer. In addition, AIG companies are leading
providers of retirement services, financial services and asset
management around the world. AIG's common stock is listed on the
New York Stock Exchange, as well as the stock exchanges in Ireland
and Tokyo.
During the third quarter of 2008, requirements to post collateral
in connection with AIG Financial Products Corp.'s credit default
swap portfolio and other AIGFP transactions and to fund returns of
securities lending collateral placed stress on AIG's liquidity.
AIG's stock price declined from $22.76 on Sept. 8, 2008, to $4.76
on Sept. 15, 2008. On that date, AIG's long-term debt ratings
were downgraded by Standard & Poor's, a division of The McGraw-
Hill Companies, Inc., Moody's Investors Service and Fitch Ratings,
which triggered additional requirements for liquidity. These and
other events severely limited AIG's access to debt and equity
markets.
On Sept. 22, 2008, AIG entered into an $85 billion revolving
credit agreement with the Federal Reserve Bank of New York and,
pursuant to the Fed Credit Agreement, AIG agreed to issue 100,000
shares of Series C Perpetual, Convertible, Participating Preferred
Stock to a trust for the benefit of the United States Treasury.
At Sept. 30, 2008, amounts owed under the facility created
pursuant to the Fed Credit Agreement totaled $63 billion,
including accrued fees and interest.
Since Sept. 30, AIG has borrowed additional amounts under the
Fed Facility and has announced plans to sell assets and businesses
to repay amounts owed in connection with the Fed Credit Agreement.
In addition, subsequent to Sept. 30, 2008, certain of AIG's
domestic life insurance subsidiaries entered into an agreement
with the NY Fed pursuant to which the NY Fed has borrowed, in
return for cash collateral, investment grade fixed maturity
securities from the insurance subsidiaries.
On Nov. 10, 2008, the U.S. Treasury agreed to purchase, through
its Troubled Asset Relief Program, $40 billion of newly issued AIG
perpetual preferred shares and warrants to purchase a number of
shares of common stock of AIG equal to 2% of the issued and
outstanding shares as of the purchase date. All of the proceeds
will be used to pay down a portion of the Federal Reserve Bank of
New York credit facility. The perpetual preferred shares will
carry a 10% coupon with cumulative dividends.
AIG and the Fed also agreed to revise the existing FRBNY credit
facility. The loan terms were extended from two to five years to
give AIG time to complete its planned asset sales in an orderly
manner. The equity interest that taxpayers will hold in AIG,
coupled with the warrants, will total 79.9%.
At Sept. 30, 2008, AIG had $1.022 trillion in total consolidated
assets and $950.9 billion in total debts. Shareholders' equity
was $71.18 billion, including the addition of $23 billion of
consideration received for preferred stock not yet issued.
The Troubled Company Reporter reported on March 4, 2009, that
Moody's Investors Service confirmed the A3 senior unsecured debt
and Prime-1 short-term debt ratings of American International
Group, Inc. AIG's subordinated debt rating has been downgraded to
Ba2 from Baa1. The rating outlook for AIG is negative. This
rating action follows AIG's announcement of net losses of
$62 billion for the fourth quarter and $99 billion for the full
year of 2008, along with a revised restructuring plan supported by
the US Treasury and the Federal Reserve. This concludes a review
for possible downgrade that was initiated on September 15, 2008.
ANDERSON HOMES: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Anderson Homes, Inc.
549 Pylon Drive
Raleigh, NC 27606
Bankruptcy Case No.: 09-02062
Debtor-affiliates filing subject to Chapter 11 petitions:
Entity Case No.
------ --------
Bridgewater Land Resource, LLC 09-02067
Land Resource Group of Raleigh, Inc. 09-02069
Vanguard Homes, Inc. 09-02071
Chapter 11 Petition Date: March 16, 2009
Court: Eastern District of North Carolina (Wilson)
Judge: A. Thomas Small
Debtor's Counsel: Gerald A Jeutter, Jr., Esq.
jeb@jeutterlaw.com
Gerald A. Jeutter, Jr., Attorney at Law PA
P.O. Box 12585
Raleigh, NC 27605-2585
Tel: (919) 334-6631
Fax: (919) 833-9793
--- and ---
John A. Northen, Esq.
jan@nbfirm.com
Northen Blue, LLP
P.O. Box 2208
Chapel Hill, NC 27515-2208
Tel: (919) 968-4441
Fax: (919) 942-6603
Total Assets: $17,190,001
Total Debts: $13,742,840
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Creative Touch Interiors $479,663
Attn: McCrae Gore
PO Box 841186
Dallas, TX 75284
Universal Forest Products $318,213
Attn: Managing Agent
5631 S. NC Hwy. 62
Burlington, NC 27215
Home-Kim Inc. $172,037
Attn: Chang Kim
5101Nelson Rd. Ste 150
Morrisville, NC 27560
Harbinger Agency $150,721
CLC Services Inc. $111,015
Ocmulgee Concrete Serv Lien Claims $94,849
Carnell's Plumbing Inc. Lien Claims $92,272
Archer Exteriors Inc $88,805
Masco Builder Cabinet Line Claims $85,660
ARS Service Express-Ral. $78,329
Fireside Hearth & Home $75,707
Tally Construction LLC $65,515
Construction Applicators $56,244
Curtis Media Group $55,522
Circuit City Stores Inc $55,453
AC Painting & Decorating $45,912
Hay's Heating & Air Lien Claims $45,406
Whirlpool $45,388
Tool Time Electric Co $43,665
BP Electric Services Inc $41,864
The petition was signed by David Servoss, chairman.
ANDERSON NEWS: Fails in Effort at Interim Trustee Appointment
-------------------------------------------------------------
The four publishers who sent Anderson News LLC to Chapter 7
liquidation failed in their effort at having the U.S. Bankruptcy
Court for the District of Delaware appoint an interim trustee,
Bloomberg's Bill Rochelle said, citing court documents.
According to Bloomberg, the publishers said Anderson shut down and
was selling $200 million in inventory to pay down a $60 million
secured loan from Sun Trust Bank. The publishers, which assert
claims aggregating $37.5 million, are Hachette Book Group Inc.,
Harper Collins Publishers LLC, Simon & Schuster Inc., and Random
House Inc.
Bill Rochelle reported that the publishers want a trustee to take
over immediately because they don't know what's happening with
$200 million of inventory.
Anderson News LLC is a sales and marketing company for books and
magazines.
ANTHONY REITANO: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Anthony Joseph Reitano
Diane Rose Reitano
22748 Marbella Cir.
Boca Raton, FL 33433
Bankruptcy Case No.: 09-13782
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Southern District of Florida (West Palm Beach)
Judge: Erik P. Kimball
Debtor's Counsel: Robert C. Furr, Esq.
2255 Glades Rd., #337W
Boca Raton, FL 33431
Tel: (561) 395-0500
Fax: (561) 338-7532
Email: bnasralla@furrcohen.com
Total Assets: $1,120,262.88
Total Debts: $1,330,441.50
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/flsb09-13782.pdf
The petition was signed by Anthony Joseph Reitano and Diane Rose
Reitano.
ARBIOS SYSTEMS: Sets Chapter 11 Plan; Energex to Get 90% of Equity
------------------------------------------------------------------
Arbios Systems, Inc., has signed a term sheet containing
preliminary terms for a recapitalization of the Company through a
$1,000,000 stock subscription by Arbios Acquisition Partners, LLC.
Since January 9, 2009, the Company has been proceeding under
Chapter 11 of the United States Bankruptcy Code under the
jurisdiction of the Bankruptcy Court in the District of Delaware.
The Company and AAP intend to file a reorganization plan
reflecting the terms of this proposed transaction, which, if
approved by the Bankruptcy Court and all of the Company's relevant
classes, could lead to the Company's emergence from Chapter 11.
AAP is a limited liability company formed for the purpose of
completing this proposed transaction. AAP is a wholly owned
subsidiary of Energex Systems, Inc., a New Jersey-based company
that was organized in 1999 to develop patented therapeutic medical
devices to treat chronic conditions and diseases.
The transaction contemplated by the term sheet calls for Arbios to
cancel all of its currently existing equity (including all
outstanding common stock, warrants, and options) and to issue new
shares of common stock:
(i) to AAP, which will represent 90% of the newly issued
shares of the Company; and
(ii) to the existing Arbios stockholders, which will
represent 10% of the newly issued shares, allocated
among the existing stockholders pro rata based on their
pre-transaction common stock ownership interest in the
Company.
Effectively, the existing stockholders of Arbios will receive one
share of new common stock for each 10 shares held by them prior to
the cancellation/re-issuance. The $1,000,000 cash purchase price
for its new shares in the Company will be paid by AAP as follows:
(i) $100,000 was paid to the Company as a deposit upon
signing of the term sheet,
(ii) $100,000 is due upon the later of April 8, 2009, or the
filing of the reorganization plan with the Bankruptcy
Court, and
(iii) $800,000 is due within 10 days of the Bankruptcy Court's
confirmation of the plan of reorganization.
If AAP fails to comply with paying the purchase price, Arbios may
retain the deposit(s) and can withdraw the reorganization plan and
move forward with an alternative transaction or proceeding. If
Arbios elects to enter into an alternative transaction prior to
the confirmation of the reorganization plan by the Bankruptcy
Court, AAP is entitled to a return of the funds it has delivered
to Arbios, plus a 3% break up fee of amounts AAP has paid to
Arbios. In addition, a portion of the deposit(s) may also be
returned to AAP if the reorganization plan is not confirmed by the
Bankruptcy Court.
"The reorganization plan contemplated by this term sheet would
allow Arbios to settle outstanding liabilities, emerge from
bankruptcy as a publicly traded company, create an opportunity for
continued development of SEPET, and potentially enable existing
shareholders to participate in the Company's future," commented
Shawn Cain, Interim President and CEO.
Arbios intends to file a motion to reorganize the Company
according to the terms outlined in the term sheet with the
Bankruptcy Court. Under the term sheet, the reorganization plan
should be confirmed by the Court on or before May 15, 2009.
However, there can be no assurances that the submitted
reorganization plan will be acceptable to the Bankruptcy Court or
all of the Company's relevant classes.
Arbios' SEPET Liver Assist Device
The SEPET(TM) Liver Assist Device is an extracorporeal (outside
the body) liver assist device for blood purification of patients
suffering from cirrhosis due to chronic liver disease and who are
hospitalized with acute complications due to worsening liver
dysfunction and portal hypertension. The SEPET(TM) device is a
sterile, disposable cartridge containing microporous hollow fibers
with proprietary permeability characteristics. SEPET(TM) is
designed for use with standard blood dialysis systems available in
hospital intensive care units.
About Arbios Systems, Inc.
Arbios Systems, Inc. -- http://www.arbios.com-- has been engaged
in the development of proprietary medical devices to enhance the
survival of millions of patients each year who experience, or are
at risk for, life-threatening episodes of liver failure. Arbios'
SEPET(TM) Liver Assist Device is a novel blood purification
therapy that provides enhanced "liver dialysis".
Arbios is a developmental stage company. In its third quarter
2008 report on form 10-Q submitted to the Securities and Exchange
Commission, Arbios disclosed $620,564 in assets and total
liabilities of $856,828.
As reported by the Troubled Company Reporter on January 13, 2009,
Arbios Systems said on January 9 that it filed for protection
under Chapter 11 of the U.S. Bankruptcy Code before the U.S.
Bankruptcy Court for the District of Delaware.
ATLAS PIPELINE: Moody's Reviews 'B1' Rating for Possible Cut
------------------------------------------------------------
Moody's Investors Service placed the ratings for Atlas Pipeline
Partners, L.P., on review for possible downgrade. The affected
ratings are Atlas' B1 Corporate Family Rating, B1 Probability of
Default Rating, Ba2 Secured Bank Facility, Ba2 Secured Term Loan,
and the B3 (LGD 5, 82%) senior unsecured rating. Moody's
downgraded Atlas's Speculative Grade Liquidity rating to SGL-4
from SGL-3.
The ratings review will assess the company's operating performance
and cost trends, as well as its expectations for capital spending
and operating results for 2009. Moody's is concerned with the
company's tight bank leverage covenant, constrained liquidity and
high financial leverage. A multi-notch downgrade is likely
without clear evidence of factors that could lead to a near-term
decline in leverage and stronger cash flow.
The last rating action on Atlas was on June 24, 2008, when Moody's
published a credit opinion following an upgrade of Atlas' senior
secured bank facility to Ba2 from Ba3, assigned a B3 senior
unsecured rating, affirmed the B1 CFR, and changed the rating
outlook to stable from negative.
Atlas Pipeline Partners, L.P., is a publicly traded master limited
partnership engaged primarily in the gathering, processing, and
transportation segments of the midstream natural gas industry.
AVENTINE RENEWABLE: Moody's Cuts Corporate Family Rating to 'Ca'
----------------------------------------------------------------
Moody's Investors Service downgraded Aventine Renewable Energy
Holdings, Inc.'s Corporate Family Rating to Ca from Caa2 and the
rating on its senior unsecured notes to C from Caa3. The
downgrade follows the company's announcement that it owes the
construction contractor (and sub-contractors) of its two
incomplete ethanol plants $24.4 million plus certain costs and
expenses in connection with the early termination of the
construction contracts. The speculative grade liquidity rating of
SGL-4 (indicating weak liquidity) was affirmed. The outlook is
negative. These summarizes the ratings.
Aventine Renewable Energy Holdings, Inc.
Ratings changes:
* Corporate Family Rating -- Ca from Caa2
* Probability of Default Rating -- Ca from Caa2
* $300mm Sr unsec notes due 2017 -- C (LGD5, 78%) from Caa3 (LGD5,
78%)
Rating affirmed:
* Speculative grade liquidity rating - SGL-4
Ratings outlook: negative
The downgrade reflects Moody's expectation that Aventine will not
have sufficient funds to pay the amounts owed to its contractor
(Kiewit Energy Company), service its debt (a $15 million interest
payment on the 10%, $300 million notes due 2017 is due April 1st )
and support other requirements. Aventine stated in its disclosure
that non-payment of the amounts owed to Kiewit causes its
associated liens to violate the limitation on liens covenant
contained in the outstanding 10% senior notes due 2017 and could
lead to a default.
Aventine's liquidity has declined over the past year as the
company has made capital expenditures for new production
facilities, continued poor ethanol industry conditions have
contributed to lackluster cash margins and it has been unable to
secure alternative sources of financing to improve its liquidity.
Aventine relies on its $200 million revolving credit facility and
existing cash balances to support its liquidity. The company is
not expected to have a fixed charge coverage ratio in excess of
1.10:1.00 and thus will not have access to the last $50 million of
availability under its revolver. Aventine is expected to have
little current borrowing capacity and will be challenged to
generate sufficient cash flow from operations to cover unforeseen
sector circumstances such as a large rise in working capital needs
(e.g., due to higher corn costs) or to support hedging activities.
Aventine's CFR and negative outlook reflects Moody's expectation
that it will continue to be difficult for it to raise capital. As
a result, the company will be largely reliant on its existing
liquidity and cash flow from operations, which may not be
sufficient to satisfy its operating and debt service needs.
Moody's most recent announcement concerning the ratings for
Aventine was on January 14, 2009. At that time, the CFR was
downgraded to Caa2 from B3 and the rating on the $300 million
senior unsecured notes due 2017 was downgraded to Caa3, reflecting
the decline in Aventine's liquidity and Moody's expectations for
weak future operating cash flows. The ratings outlook was changed
to negative.
Aventine is a U.S. producer and marketer of ethanol used as a
blending component for gasoline. The company produces ethanol and
co-products at its Pekin, Illinois wet milling and dry milling
plants, and its dry milling Aurora, Nebraska plant. Additionally,
the firm operates a marketing alliance that pools ethanol from
multiple third party producers and sells it nationwide for which
it receives a commission. Revenues for the LTM ended
September 30, 2008, were approximately $2.1 billion.
BALLY TOTAL: Gets Court Okay to Hire BDO Seidman as Auditors
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized Bally Total
Fitness Holding Corp. and its debtor-affiliates to employ BDO Seidman,
LLP as their auditors,
nunc pro tunc to December 3, 2008.
Bradley O'Neill, Esq., at Kramer Levin Naftalis & Frankel LLP, in
New York, has said BDO provided the Debtors with audit services before
the Petition Date. Thus
BDO has acquired considerable knowledge of the Debtors' business and
financial affairs.
According to Mr. O'Neill, those services enabled the Debtors to stay
on schedule to meet various
reporting and filing deadlines.
As auditors, BDO will provide:
(a) Audit services, including conducting an audit of the
Debtors' consolidated financial statements as of
December 31, 2008, analyzing accounting issues and
transactions, and consulting with the Debtors' management
regarding the proper accounting treatment of events, as
allowed by professional standards, as of December 31, 2008;
and
(b) Audit-related agreed-upon procedures, including analytical
reviews of the Debtors' balance sheets and reserves,
limited reviews of internal controls, and other services as
are necessary to comply with the debtors-in-possession
agreement.
The Debtors have agreed to compensate BDO for professional
services rendered at 90% of its customary hourly rates, up to a
cap of $1,500,000. The current hourly rates for audit services
to be rendered by BDO are:
Normal Range 90% Range
Position Low High Low High
-------- --- ---- --- ----
Partner $425 $700 $382 $630
Senior
Manager $300 $375 $270 $337
Manager $205 $300 $184 $270
Senior
Associate $170 $220 $153 $198
Associate $136 $175 $122 $157
Intern $120 $108
In the normal course of BDO's business, the hourly rates are
subject to periodic increase. To the extent the hourly rates are
increased, the Debtors request authority to pay BDO those
increased rates. BDO will be reimbursed for any expenses
incurred in connection with its representation of the Debtors.
Pursuant to the parties' engagement letter, the Debtors agree
that BDO will not be liable for any claims, liabilities or
expenses relating to its engagement, for an aggregate amount in
excess of its fees as paid by the Debtors, except to the extent
judicially determined to result from gross negligence, bad faith
or intentional misconduct. BDO will not be liable for any loss
of use, data, goodwill, or revenues, or any consequential or
exemplary loss or damage in connection with its retention.
Richard J. Krieberg, a partner at BDO, attests that his company is a
"disinterested person" under
Section 101(14) of the Bankruptcy Code, and holds no interest adverse
to the Debtors and their
estates.
About Bally Total Fitness
Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates
fitness centers in the U.S.,
with over 375 facilities located in 26 states, Mexico, Canada, Korea,
China and the Caribbean
under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports
Clubs of Canada (R) brands.
Bally Total and its affiliates filed for Chapter 11 protection
7on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after
obtaining requisite number of votes in favor of their pre-
packaged chapter 11 plan. Joseph Furst, III, Esq. at Latham &
Watkins, L.L.P. represents the Debtors in their restructuring
efforts. As of June 30, 2007, the Debtors had US$408,546,205 in
total assets and US$1,825,941,54627 in total liabilities.
The Debtors filed their Joint Prepackaged Plan & Disclosure
Statement on July 31, 2007. The Court confirmed the Plan in
September 2007. The Plan was declared effective Oct. 1, 2007.
Bally Total Fitness Holding Corp. and its debtor-affiliates and
subsidiaries again filed voluntary petitions under Chapter 11 on
Dec. 3, 2008 (Bankr. S. D. N. Y., Lead Case No. 08-14818). Their
counsel is Kenneth H. Eckstein, Esq. at Kramer Levin Naftalis &
Frankel LLP, in New York. As of September 30, 2008, the Company
(including non-debtor affiliates) had consolidated assets totaling
approximately $1.376 billion and
recorded consolidated liabilities totaling approximately $1.538 billion.
Bankruptcy Creditors' Service, Inc., publishes Bally Bankruptcy
News. The newsletter provides gavel-to-gavel coverage of the
chapter 11 proceedings of Bally Total Fitness Holding Corp. and
its debtor-affiliates (http://bankrupt.com/newsstand/or
215/945-7000)
BALLY TOTAL: Panel Gets Permission to Hire Akin Gump as Counsel
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized the official
committee of unsecured creditors in the bankruptcy cases of Bally
Total Fitness Holding Corp. and
its debtor-affiliates to retain Akin Gump Strauss Hauer & Feld LLP, as
its counsel, nunc pro tunc to
December 12, 2008.
As counsel, Akin Gump will:
(a) advise the Committee with respect to its rights, duties
and powers;
(b) assist and advise the Committee in its consultations with
the Debtors relative to the administration of the
Chapter 11 cases;
(c) assist the Committee in analyzing the claims of the
Debtors' creditors and the Debtors' capital structure and
in negotiating with holders of claims and equity
interests;
(d) assist the Committee in its investigation of the acts,
conduct, assets, liabilities and financial condition of
the Debtors and of operation of their businesses;
(e) assist the Committee in its analysis of, and negotiations
with, the Debtors or any third party concerning matters
related to the assumption or rejection of certain leases
of non-residential real property and executory contracts,
asset dispositions, financing of other transactions, and
any plan of reorganization and accompanying disclosure
statements;
(f) assist and advise the Committee as to its communications
to the general creditor body regarding significant
matters;
(g) represent the Committee at all hearings and other
proceedings before the Court;
(h) review and analyze applications, orders, statements of
operations and schedules and advise the Committee as to
their propriety;
(i) advise and assist the Committee with respect to any
legislative, regulatory or governmental activities;
(j) assist the Committee in preparing pleadings and
applications as may be necessary in furtherance of the
Committee's interests and objectives;
(k) assist the Committee in its review and analysis of all of
the Debtors' various agreements;
(l) prepare, on behalf of the Committee, any pleadings,
including motions, memoranda, adversary complaints, or
objections in connection matters related to the
Chapter 11 cases;
(m) investigate and analyze any claims against the Debtors'
non-debtor affiliates; and
(n) perform other legal services, as required by the
Committee.
Akin Gump professionals will be compensated pursuant to their
standard hourly rates:
Professional Hourly Rate
------------ -----------
Partners $460-$1,050
Special Counsel and Counsel $250-$810
Associates $175-$580
Paraprofessionals $75-$250
Three Akin Gump attorneys from the firm's financial restructuring
department are expected to have primary responsibility for
providing services to the Committee, and will be paid at these
rates:
Professional Hourly Rate
------------ -----------
David H. Botter, Partner $825
Meredith A. Lahaie, Associate $460
Stefanie L. Kurlanzik, Associate $375
David H. Botter, Esq., attorney at Akin Gump, attests that the firm is
a "disinterested person" under
Section 101(14) of the Bankruptcy Code, and holds no interest adverse
to the Debtors and their
estates. However, he said that Akin Gump is a large firm with a
national and international practice,
and may represent or may have represented certain of the Debtors'
creditors, equity holders, or
other parties-in-interest in matters unrelated to the Debtors' Chapter
11 cases. Mr. Botter said Akin
Gump will not commence a cause of action against any current client,
which includes the Debtors'
Prepetition Lenders, unless the client issues a waiver allowing Akin
Gump to commence an action.
About Bally Total Fitness
Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates
fitness centers in the U.S.,
with over 375 facilities located in 26 states, Mexico, Canada, Korea,
China and the Caribbean
under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports
Clubs of Canada (R) brands.
Bally Total and its affiliates filed for Chapter 11 protection
7on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after
obtaining requisite number of votes in favor of their pre-
packaged chapter 11 plan. Joseph Furst, III, Esq. at Latham &
Watkins, L.L.P. represents the Debtors in their restructuring
efforts. As of June 30, 2007, the Debtors had US$408,546,205 in
total assets and US$1,825,941,54627 in total liabilities.
The Debtors filed their Joint Prepackaged Plan & Disclosure
Statement on July 31, 2007. The Court confirmed the Plan in
September 2007. The Plan was declared effective Oct. 1, 2007.
Bally Total Fitness Holding Corp. and its debtor-affiliates and
subsidiaries again filed voluntary petitions under Chapter 11 on
Dec. 3, 2008 (Bankr. S. D. N. Y., Lead Case No. 08-14818). Their
counsel is Kenneth H. Eckstein, Esq. at Kramer Levin Naftalis &
Frankel LLP, in New York. As of September 30, 2008, the Company
(including non-debtor affiliates) had consolidated assets totaling
approximately $1.376 billion and
recorded consolidated liabilities totaling approximately $1.538 billion.
Bankruptcy Creditors' Service, Inc., publishes Bally Bankruptcy
News. The newsletter provides gavel-to-gavel coverage of the
chapter 11 proceedings of Bally Total Fitness Holding Corp. and
its debtor-affiliates (http://bankrupt.com/newsstand/or
215/945-7000)
BALLY TOTAL: Panel Gets Court OK to Tap FTI as Financial Advisors
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York has
authorized the official
committee of unsecured creditors in the bankruptcy cases of Bally
Total Fitness Holding Corp. and
its debtor-affiliates to retain FTI Consulting, Inc., as its financial
advisors, nunc pro tunc to
December 18, 2008.
The chairman of the Committee, Leo Burnett Company, Inc., said the
services of a financial advisor
is necessary in order to advise the Committee in the course of the
Debtors' Chapter 11 cases.
As financial advisor, FTI will:
* Assist the Committee in reviewing financial related
disclosures, including the schedules of assets and
liabilities, the statement of financial affairs and monthly
operating reports;
* Assist with information and analyses of a possible
debtor-in-possession financing;
* Assist with a review of the Debtors' proposed key employee
retention and other critical employee benefit programs;
* Assist and advise the Committee with respect to the
identification of the Debtors' core business assets, the
disposition of assets, or liquidation of unprofitable
operations;
* Assist with evaluations with respect to the affirmation or
rejection of various executory contracts and leases;
* Assist with the valuation of the level of operations and
identification of areas of potential cost savings,
including overhead and operating expense reductions and
efficiency improvements;
* Assist in the review of financial information distributed
by the Debtors to creditors and others, including cash flow
projections and budgets, cash receipts and disbursement
analysis, analysis of various asset and liability accounts,
and analysis of proposed transactions;
* Attend meetings and assist in discussions with the Debtors,
potential investors, banks, other secured lenders, the
Committee and any other official committees, the U.S.
Trustee, other parties-in-interest and their professionals;
* Assist in the review and preparation of information and
analysis necessary for the confirmation of a plan; and
* Render general business consulting or other assistance as
the Committee may deem necessary, which are not duplicative
of services provided by other professionals.
FTI will be paid on a fixed monthly basis of $150,000 per month,
plus reimbursement of actual and necessary expenses incurred.
The Monthly Fixed Fee will be subject to a periodic review by the
Committee and FTI, and approval by the Court.
Steven Simms, senior managing director with FTI Consulting, Inc., said
FTI is a "disinterested
person" under Section 101(14) of the Bankruptcy Code, and holds no
interest adverse to the
Debtors and their estates.
About Bally Total Fitness
Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates
fitness centers in the U.S.,
with over 375 facilities located in 26 states, Mexico, Canada, Korea,
China and the Caribbean
under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports
Clubs of Canada (R) brands.
Bally Total and its affiliates filed for Chapter 11 protection
7on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after
obtaining requisite number of votes in favor of their pre-
packaged chapter 11 plan. Joseph Furst, III, Esq. at Latham &
Watkins, L.L.P. represents the Debtors in their restructuring
efforts. As of June 30, 2007, the Debtors had US$408,546,205 in
total assets and US$1,825,941,54627 in total liabilities.
The Debtors filed their Joint Prepackaged Plan & Disclosure
Statement on July 31, 2007. The Court confirmed the Plan in
September 2007. The Plan was declared effective Oct. 1, 2007.
Bally Total Fitness Holding Corp. and its debtor-affiliates and
subsidiaries again filed voluntary petitions under Chapter 11 on
Dec. 3, 2008 (Bankr. S. D. N. Y., Lead Case No. 08-14818). Their
counsel is Kenneth H. Eckstein, Esq. at Kramer Levin Naftalis &
Frankel LLP, in New York. As of September 30, 2008, the Company
(including non-debtor affiliates) had consolidated assets totaling
approximately $1.376 billion and
recorded consolidated liabilities totaling approximately $1.538 billion.
Bankruptcy Creditors' Service, Inc., publishes Bally Bankruptcy
News. The newsletter provides gavel-to-gavel coverage of the
chapter 11 proceedings of Bally Total Fitness Holding Corp. and
its debtor-affiliates (http://bankrupt.com/newsstand/or
215/945-7000)
BALLY TOTAL: Affiliates File Schedules and Statements
-----------------------------------------------------
Fourteen debtor-affiliates of Bally Total Fitness of Greater New
York, Inc., reported to the U.S. Bankruptcy Court for the Southern
District of New York assets of
more than $1,000,000, and liabilities on account of secured claims:
Debtor Assets Debts
------ ------------ ------------
Bally Total Fitness of California $64,052,676 $566,256,257
Bally Total Fitness of the Midwest $45,865,116 $565,677,182
Bally Total Fitness of the
Mid-Atlantic $38,838,836 $564,139,047
Bally Total Fitness International $18,111,462 $562,635,719
Bally Total Fitness of Philadelphia $12,639,479 $561,955,875
Bally Total Fitness of Upstate
New York, Inc. $4,504,553 $561,360,116
BTF Indianapolis Corporation $3,298,406 $321,845
BTF Cincinnati Corporation $3,032,426 $410,871
Bally Total Fitness of Colorado $2,224,638 $561,750,696
Bally Total Fitness of Missouri $1,959,451 $561,424,519
Bally REFS West Hartford LLC $1,742,007 $301,690,338
Tidelands Holiday Health Clubs, Inc. $1,574,173 $561,186,130
Bally Sports Clubs, Inc. $1,210,024 $561,882,060
BTF/CFI, Inc. $1,037,471 $302,222,980
The 14 Debtors' debts include five secured claims totaling
$561,086,784:
Creditor Amount
-------- ------------
Morgan Stanley Senior Funding, Inc./ $294,605,284
Wells Fargo Foothill LLC
Morgan Stanley Capital Services, Inc. $7,085,054
US Bank N.A., as Indenture Trustee to $259,396,446
Senior Subordinated Notes
Wells Fargo Foothill LLC Unliquidated
Nine debtor-affiliates reported assets ranging between $100,000 and
$1,000,000, and liabilities on
account of secured claims:
Debtor Assets Debts
------ ------- -----
Bally Total Fitness of Connecticut $975,278 $561,671,654
Bally Total Fitness of Rhode Island $764,205 $561,244,426
BTFF Corporation $646,439 $504,719
Bally Total Fitness of the Southeast $575,794 $561,269,269
Bally Total Fitness of Minnesota
Coast, Inc. $428,688 $561,151,108
Bally Fitness Franchising, Inc. $218,335 $561,086,784
Bally Total Fitness Franchising $202,031 $561,086,784
Bally Total Fitness of Toledo, Inc. $197,864 $301,954,112
Bally Total Fitness of Connecticut
Valley, Inc. $190,092 $561,196,681
The nine Debtors' debts include five secured claims totaling
$561,086,784:
Creditor Amount
-------- ------------
Morgan Stanley Senior Funding, Inc./ $294,605,284
Wells Fargo Foothill LLC
Morgan Stanley Capital Services, Inc. $7,085,054
US Bank N.A., as Indenture Trustee to $259,396,446
Senior Subordinated Notes
Wells Fargo Foothill LLC Unliquidated
Ten debtor-affiliates reported assets of $0, and liabilities on
account of secured claims:
* Bally Franchise RSC, Inc.;
* Bally Franchising Holdings, Inc.;
* Greater Philly No. 1 Holding Company;
* Greater Philly No. 2 Holding Company;
* Health & Tennis Corporation of New York;
* Holiday Health Clubs of the East Coast;
* Holiday/Southeast Holding Corporation;
* Jack LaLanne Holding Corp.;
* New Fitness Holding Co., Inc.; and
* Nycon Holding Co., Inc.
The Debtors' debts consist of five secured claims totaling
$561,086,784:
Creditor Amount
-------- ------------
Morgan Stanley Senior Funding, Inc./ $294,605,284
Wells Fargo Foothill LLC
Morgan Stanley Capital Services, Inc. $7,085,054
US Bank N.A., as Indenture Trustee to $259,396,446
Senior Subordinated Notes
Wells Fargo Foothill LLC Unliquidated
Rhode Island Holding Company owes secured claims to Morgan Stanley
Senior Funding, Inc., and
Wells Fargo Foothill LLC, totaling $294,605,284; Morgan Stanley
Capital Services, Inc., totaling
$7,085,054; as well as an unliquidated claim to Wells Fargo Foothill LLC.
Five debtor-affiliates reported assets and debts of $0:
* Bally ARA Corporation;
* Bally Real Estate I LLC;
* BTF Europe Corporation;
* BTF Minneapolis Corporation; and
* BTFCC, Inc.
The debtor-affiliates also filed with the Court copies of their
unaudited Statements of Financial
Affairs. The Debtors' statement of financial affairs are presented on
a consolidated basis and are
reported under Bally Total Fitness of Greater New York, Inc., Harvey
Rubinson, the Debtors'
interim chief financial officer, said.
About Bally Total Fitness
Based in Chicago, Illinois, Bally Total Fitness Holding Corp.
(Pink Sheets: BFTH.PK) -- http://www.ballyfitness.com/-- operates
fitness centers in the U.S.,
with over 375 facilities located in 26 states, Mexico, Canada, Korea,
China and the Caribbean
under the Bally Total Fitness(R), Bally Sports Clubs(R) and Sports
Clubs of Canada (R) brands.
Bally Total and its affiliates filed for Chapter 11 protection
7on July 31, 2007 (Bankr. S.D.N.Y. Case No. 07-12396) after
obtaining requisite number of votes in favor of their pre-
packaged chapter 11 plan. Joseph Furst, III, Esq. at Latham &
Watkins, L.L.P. represents the Debtors in their restructuring
efforts. As of June 30, 2007, the Debtors had US$408,546,205 in
total assets and US$1,825,941,54627 in total liabilities.
The Debtors filed their Joint Prepackaged Plan & Disclosure
Statement on July 31, 2007. The Court confirmed the Plan in
September 2007. The Plan was declared effective Oct. 1, 2007.
Bally Total Fitness Holding Corp. and its debtor-affiliates and
subsidiaries again filed voluntary petitions under Chapter 11 on
Dec. 3, 2008 (Bankr. S. D. N. Y., Lead Case No. 08-14818). Their
counsel is Kenneth H. Eckstein, Esq. at Kramer Levin Naftalis &
Frankel LLP, in New York. As of September 30, 2008, the Company
(including non-debtor affiliates) had consolidated assets totaling
approximately $1.376 billion and
recorded consolidated liabilities totaling approximately $1.538 billion.
Bankruptcy Creditors' Service, Inc., publishes Bally Bankruptcy
News. The newsletter provides gavel-to-gavel coverage of the
chapter 11 proceedings of Bally Total Fitness Holding Corp. and
its debtor-affiliates (http://bankrupt.com/newsstand/or
215/945-7000)
BARRIAN PRECISION: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Barrian Precision Manufacturing, LLC
d/b/a Milford Automatics
28 Progress Avenue
Seymour, CT 06483
Bankruptcy Case No.: 09-30507
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
District of Connecticut (New Haven)
Judge: Lorraine Murphy Weil
Debtor's Counsel: James G. Verrillo, Esq.,
Matthew K. Beatman, Esq.
Zeisler and Zeisler
558 Clinton Avenue
P.O. Box 3186
Bridgeport, CT 06605
Tel: (203) 368-4234
Fax: (203) 367-9678
Email: jverrillo@zeislaw.com
Email: MBeatman@zeislaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/ctb09-30507.pdf
The petition was signed by Brian Mulholland, vice president of the
Company.
BEARINGPOINT INC: Cash Collateral Order Revised on Panel Objection
------------------------------------------------------------------
BearingPoint Inc., will continue to have access to its lenders'
cash collateral, but subject to modified provisions. The U.S.
Bankruptcy Court for the Southern District of New York has
extended its interim order on BearingPoint's cash collateral use,
until a final hearing, which has been postponed to March 30.
The Debtor rescheduled the final hearing by about two weeks after
its official committee of unsecured creditors conveyed objections
to the proposal. The panel said that while all parties agree that
cash collateral is necessary to fund operations, it balks at a
suite of provisions -- the hair-trigger budget controls, default
conditions, automatic stay relief grants, and confirmation
milestones -- designed to lock in a plan favorable to the senior
lenders and thereby control the reorganization.
According to Bloomberg's Bill Rochelle, although the hearing was
reset for March 30 as requested, some of the objectionable
provisions in the cash-use arrangement were modified. Among them,
the lenders can't cut off use of cash without 24 hours' notice and
can't exercise any remedies unless the bankruptcy court modifies
the so-called automatic stay.
Committee's Objection
BearingPoint filed, on the day of its bankruptcy filing, a
proposed Chapter 11 plan it negotiated with senior lenders. The
Plan provides for these terms: (i) senior lenders would receive a
senior note secured by all assets, "New Preferred Stock," and five
seats on a seven-seat board of directors, and (ii) unsecured
creditors would recover up to 10% in the form of common stock.
The Committee's counsel, Jeffrey S. Sabin, Esq., at Bingham
McCutchen LLP, in New York, argues that the timeline agreed by
BearingPoint and lenders affords no opportunity for a consensual
plan or alternative plan proposal, and cedes the estate to the
senior lenders by default should there by any departure from the
Plan or the schedule or should the Plan not be to their liking.
Mr. Sabin notes that if the cash collateral use is approved on its
original terms, the BearingPoint and affiliates would be required
to:
-- file a Plan and disclosure statement "each in form and
substance acceptable to the senior lenders by February 24
(Plan filed);
-- obtain approval of the disclosure statement to the Plan by
March 31;
-- obtain Plan confirmation by May 12; and
-- cause the Plan to become effective by May 26.
The Committee also conveyed opposition to the Plan itself, noting
that giving senior lenders control -- with five of seven seats of
the board of directors of the reorganized company -- would give
them power to effectuate a quick, post-bankruptcy sale.
Arrangements for a fire sale that were not submitted to the Court
were launched in earnest on February 23, when for the first time
the Debtors permitted bidders to bid on less than all of the
company.
The Committee, however, notes that the Debtors have received a
number of bids, including bids that would preserve the
BearingPoint enterprise, and have indicative enterprise value that
could potentially be hundreds of millions of dollars in excess of
the indicated value in the Plan.
Additionally, according to Mr. Sabin, valuation documents received
from the Debtors, including documents from as recent as December
of last year, imply that BearingPoint has an enterprise value in
excess of $1 billion. These documents also make reference to the
fact that despite significant economic headwinds, the Debtors
significantly improved profitability in 2008.
Other parties that have filed objections to the proposed cash
collateral use include Law Debenture Trust Company of New York, in
its role as trustee; The Bank of New York Mellon, as indenture
trustee.
About BearingPoint Inc.
BearingPoint, Inc. -- http://www.BearingPoint.com-- is currently
one of the world's largest providers of management and technology
consulting services to Global 2000 companies and government
organizations in more than 60 countries worldwide. Based in
McLean, Va., BearingPoint -- a former consulting arm of KPMG LLP
-- has approximately 15,000 employees focusing on the Public
Services, Commercial Services and Financial Services industries.
BearingPoint professionals have built a reputation for knowing
what it takes to help clients achieve their goals, and working
closely with them to get the job done. The Company's service
offerings are designed to help clients generate revenue, increase
cost-effectiveness, manage regulatory compliance, integrate
information and transition to "next-generation" technology.
BearingPoint, Inc. fka KPMG Consulting, Inc., together with its
units, filed for Chapter 11 on February 18, 2009 (Bankr. S.D.
N.Y., Case No. 09-10691). Alfredo R. Perez, Esq. at Weil Gotshal
& Manges LLP, has been tapped as counsel. Greenhill & Co., LLC,
and AP Services LLC, have also been tapped as advisors. Davis
Polk & Wardell is special corporate counsel. BearingPoint
disclosed total assets of $1,762,689,000, and debts of
$2,231,839,000 as of Sept. 30, 2008.
Contemporaneous with their bankruptcy petitions, the Debtors filed
a pre-packaged Joint Plan of Reorganization under Chapter to
implement the terms of their agreement with the secured lenders.
Under the Plan, the Debtors propose to exchange general unsecured
claims for equity in the reorganized company. Existing
shareholders are out of the money. The Plan and the explanatory
disclosure statement remain subject to approval by the Bankruptcy
Court.
BEL TRUST: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: Bel Trust
3132 Millers Run Road
Cecil, PA 15321
Bankruptcy Case No.: 09-21505
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Cynthia Iannarelli 09-21503
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of Pennsylvania (Pittsburgh)
Debtor's Counsel: Robert O Lampl, Esq.
960 Penn Avenue, Suite 1200
Pittsburgh, PA 15222
Tel: (412) 392-0330
Fax: (412) 392-0335
Email: rol@lampllaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of 20 largest unsecured creditors
together with its petition.
The petition was signed by Cynthia Iannarelli, Trustee of the
company.
BILTRITE RUBBER: Files for Bankruptcy in Canada and Toledo
----------------------------------------------------------
Biltrite Rubber Inc. and its Canadian parent filed Chapter 15
petitions on March 12 in Toledo, Ohio, the same day they filed for
protection from creditors in the Ontario Superior Court of Justice
under Canada's Companies' Creditors Arrangement Act, Bloomberg's
Bill Rochelle said.
Bilrite and its parent are asking the U.S. Bankruptcy Court to
recognize the Canadian court as the "foreign main proceeding." If
the Chapter 15 petition is approved, the U.S. Court will preclude
creditors from taking action in the U.S., in the process forcing
even creditors in the U.S. to hash out their problems in front of
the judge in Canada.
According to Bill Rochelle, the monitor appointed in the Canadian
case intends to sell The rubber compounds business as a going
concern. The monitor is requiring initial bids by April 17.
The Company was forced to resort to bankruptcy when a sale-and-
lease back transaction fell through.
The Chapter 15 petition said assets and debt are both less than
$50 million.
BLOCKBUSTER INC: Wattles Buys 5.7% Stake Despite Bankruptcy Rumors
------------------------------------------------------------------
Mark Wattles of Wattles Capital Management doesn't think that
Blockbuster Inc. has a plan to file for Chapter 11 bankruptcy
protection, according to a filing with the U.S. Securities and
Exchange Commission.
On March 16, Mr. Wattles filed a Schedule 13D, saying that he now
owns a 5.7% stake in the Company. Wattles Capital Management,
LLC, and the HKW Trust bought 4,841,937 and 2,000,000 Class A
shares of Common Stock, respectively, which together represent
5.7% of Blockbuster's outstanding shares of Class A Common Stock.
Mr. Wattles also owns Class B Common Stock as well as the 9.0%
senior notes of the Company. Mr. Wattles is the sole member and
manager of WCM, and sole trustee of the Trust.
Mr. Wattles doesn't believe that Blockbuster has a motive to
reorganize under Chapter 11, given the operating fundamentals of
the Company combined with the short term of its real estate leases
(typically five years) and the aggressive and proactive manner in
which the Company has managed its store base (including
relocations, store closings, reductions in store size and
subleases).
Mr. Wattles believes that Blockbuster will continue as a going
concern despite the market's expectation of obtaining a qualified
opinion from the Company's auditors in conjunction with the year-
end audit.
Regardless of the likelihood of obtaining a going concern
qualification from its auditors, Mr. Wattles believes that
Blockbuster will be successful in refinancing its revolving bank
line of credit, or if it cannot, that it will be able to use cash
flow from operations to meet its August repayment obligations and
2009 liquidity needs.
Mr. Wattles fully supports Blockbuster's management and doesn't
seek to control or influence the composition of the board of
directors, the financing or operating plans, corporate governance
policies, or other matters of the Company.
According to Bloomberg, Blockbuster rose 15% in New York trading
after Mark Wattles took a 5.7% equity stake and expressed
confidence that the company can meet its obligations.
The Company disclosed $2.62 billion of assets and debts of $2.00
billion as of Oct. 5, 2008.
In a bankruptcy filing, creditors and interest holders will line
up to seek recovery. Under the absolute priority rule of the
Bankruptcy Code, however, secured creditors have priority over a
company's unsecured creditors to the extent of the value of their
collateral. Unsecured creditors, on the other hand, stand ahead
of investors in the receiving line and their claims must be
satisfied before any investment loss is compensated. When there
is not enough to pay claims, investors will be "out-of-the-money",
and will not receive any recovery for their interests. In some
cases, "out-of-the-money" investors may keep control of the
company by buying debt.
About Blockbuster Inc.
Based in Dallas, Texas, Blockbuster Inc. is a leading global
provider of in-home movie and game entertainment, with more than
7,500 stores throughout the Americas, Europe, Asia and Australia.
The Company may be accessed worldwide at
http://www.blockbuster.com/
* * *
As reported by the Troubled Company Reporter on March 4, 2009,
Blockbuster Inc. said it has no intention of filing for
bankruptcy. The Company has hired the law firm of Kirkland &
Ellis LLP to advise it with respect to its ongoing financing and
capital raising initiatives.
Blockbuster made a pitch to acquire Circuit City early last year,
but withdrew the offer after completing due diligence. Circuit
City has since filed for bankruptcy.
The TCR said on March 6, 2009, that Standard & Poor's Ratings
Services placed its ratings, including the 'B-' corporate credit
rating, on Blockbuster on CreditWatch with negative implications.
This action reflects S&P's concern regarding the company's ability
to refinance the August 2009 maturity of its revolving credit and
term loan A facilities.
Fitch meanwhile expects Blockbuster will be able to repay the
approximately $19 million outstanding on the term loan A and
possibly renew its bank facility, although the terms will likely
be more restrictive as Blockbuster is anticipated to report
positive EBITDA and free cash flow generation for fiscal 2008. In
the event the refinancing is not successful and Blockbuster's
liquidity position is weakened, this will prompt Fitch to review
the ratings on the company.
BOOTH MANUFACTURING: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Booth Manufacturing Company
d/b/a Auto Labe, Auto Pak
3101 Industrial Avenue, #2
Fort Pierce, FL 34946
Bankruptcy Case No.: 09-10715
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Brendan Linehan Shannon
Debtor's Counsel: Brett Fallon, Esq.,
Douglas N. Candeub, Esq.
Morris James LLP
500 Delaware Avenue, Suite 1500
P.O. Box 2306
Wilmington, DE 19899-2306
Tel: (302) 888-6888, (302) 888-6854
Fax: (302) 571-1750
Email: bfallon@morrisjames.com
Email: dcandeub@morrisjames.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/deb09-10715.pdf
The petition was signed by Roy Shepherd, Secretary and Chief
Financial Officer of the company.
BRUNO'S SUPERMARKETS: Proposes Incentive Plan for 21 Managers
-------------------------------------------------------------
Bruno's Supermarkets, LLC, seek permission from the U.S.
Bankruptcy Court for the Northern District of Alabama to
implementa Sale and Retention Incentive Plan.
The Debtor tells the Court that the Incentive Plan would help
ensure that employees who are essential to the sale process and
critical to effectively managing the Debtor's estate are retained
and properly motivated to maximize value, and thus is in the best
interests of its estate and creditors.
The Sale and Retention Incentive Plan groups employees eligible
for payments into groups:
a) five senior management executives directly responsible for
assisting in selling the assets (Tier I); and
b) sixteen department head, regional and divisional management
employees whose loss would impair the Debtor's ability to
function in the bankruptcy estate and to maximize value to
the estate (Tier II).
Tier One Employees are eligible for incentive payments while the
Tier Two Employees are eligible for retention payments.
Incentive payments are contingent upon a sale of a substantial
number of the Debtor's stores and correlate to the total sale
value received from the sale. The Tier One Employees would
receive incentive payments of up to $298,333 if the total sale
value ranges from $40 million up to $45 million, up to $447,500 if
the total sales value ranges from $45 million up to
$55 million, and up to $671,250 if the total sales value is
greater than or equal to $55 million. Incentive payments will
only be made if the Total Sale Value is equal or greater than
$40 million.
Payments under the Retention Component will be made on June 1,
2009. The Retention Payments will total no more than $228,977
which approximates 16.7% of each Tier Two Employee's annual
salary.
The maximum payments that may be made under the Plan total no more
than $900,227.
Bruno's Supermarkets, LLC, is a privately held company
headquartered in Birmingham, Alabama. Bruno's is the parent
company of the Bruno's, Food World, and FoodMax grocery store
chains, which includes 23 Bruno's, 41 Food World, and 2 FoodMax
locations in Alabama and the Florida panhandle. Founded in
1933, Bruno's has operated as an independent company since 2007
after undergoing several transitions and changes in ownership
starting in 1995.
Bruno's filed voluntary Chapter 11 petitions on Feb. 5, 2009
(Bankr. N.D. Ala. Case No. 09-00634). Bruno's has retained
Alvarez & Marsal, a restructuring and corporate advisory firm, to
assist the company throughout the restructuring process. Burr &
Forman LLP is the Debtor's lead counsel. Najjar Denaburg, P.C. is
its conflicts counsel.
BUSINESS LOAN: Fitch Downgrades Ratings on Class M to 'BB'
----------------------------------------------------------
Fitch Ratings takes these rating actions on four Business Loan
Express transactions:
Business Loan Express SBA Loan-Backed Adjustable Rate Notes,
Series 2001-2
-- Class A downgraded to 'A' from 'AA', remains on Rating Watch
Negative;
-- Class M downgraded to 'BB' from 'BBB', remains on Rating
Watch Negative.
Business Loan Express SBA Loan-Backed Adjustable Rate Notes,
Series 1998-1
-- Class A rated 'AAA', remains on Rating Watch Negative.
Business Loan Express SBA Loan-Backed Adjustable Rate Notes,
Series 2002-1
-- Class A rated 'AAA', remains on Rating Watch Negative;
-- Class M rated 'A', remains on Rating Watch Negative.
Business Loan Express Business Loan-Backed Adjustable Rate Notes,
series 2002-A
-- Class A rated 'AAA', remains on Rating Watch Negative;
-- Class B rated 'A', remains on Rating Watch Negative.
The downgrades reflect continued deterioration within the
collateral pool for the series 2001-2. Since Fitch's last review
in October 2008, the transaction has continued to experience
losses and increasing delinquencies, with 60+ day delinquencies
currently representing 27.26% of the pool. Particularly, the
2001-2 transaction has experienced $1.3 million in additional net
losses since October 2008. To date, cumulative net losses are
currently at 8.06%. Additionally, Fitch has continued to see
consistent delinquency bucket roll-forward rates and expects this
trend to continue, which ultimately may lead to further portfolio
asset deterioration. Fitch's analysis, detailed below,
anticipates further declining credit support available to the
outstanding classes.
The transactions were initially placed on Rating Watch Negative on
Oct. 6, 2008, due to the Chapter 11 bankruptcy filing by the
servicer, Ciena Capital, LLC. The bankruptcy filing and upticks
in performance continue to be a concern for Fitch. Since October
2008, Fitch has continued to see an increase in delinquency
performance across the transactions. As delinquencies continue to
roll forward, further deterioration could occur within the pools,
which may lead to decline in available credit enhancement. As a
result, Fitch is maintaining the Rating Watch Negative on all
rated classes across the four transactions.
In its analysis, Fitch reviewed the transactions on an individual
loan basis. All loans over 60 days delinquent were deemed
defaulted loans. Loss and recovery expectations were applied on
the loans based on collateral characteristics (i.e. real estate,
machinery and equipment, and accounts receivables) and historical
recovery performance. Furthermore, additional haircuts were
applied on various late stage delinquency buckets due to the
historical roll rates seen within these late stage delinquency
buckets. After determining expected losses on each loan, these
expectations were applied to outstanding balances. Fitch was then
able to assess the impact on enhancement levels.
CANNERY CASINO: Moody's Reviews Ratings on Crown Limited Merger
---------------------------------------------------------------
Moody's Investors Service placed the ratings of Cannery Casino
Resorts, LLC on review for possible downgrade following the
announcement that the merger agreement between Cannery's owners
and the higher rated Crown Limited (Baa2/negative) was terminated.
The review for downgrade considers that as a result of the merger
termination, Cannery remains exposed to potential covenant
violations as well as higher than anticipated leverage as a result
of depressed gaming demand in the Las Vegas Locals market. Both
of these factors would not have been an issue had merger occurred
as planned.
The review for possible downgrade also considers that while the
company expects to benefit from the receipt of a $50 million
termination fee and a $320 million preferred equity investment
that were part of the termination agreement, there is no assurance
that these proceeds will be used to reduce debt enough to bring
leverage in line with a B2 Corporate Family Rating. As of the
last twelve months ended 9/30/2008, debt/EBITDA was 8.5times --
high for the current rating -- and there is limited detail
available at this time regarding the specific use of the net
proceeds from the termination fee and the preferred stock
investment
Moody's review will focus on Cannery's use of the termination fee
and preferred equity proceeds, particularly with respect to how
these proceeds might be used to reduce leverage and assure
covenant compliance. The review will also consider the impact
that unfavorable economic conditions might have on the ramp-up of
the redeveloped Cannery Eastside property in Las Vegas that opened
in August 2008, its permanent Meadows facility in Pennsylvania
that is scheduled to open in April 2008.
These ratings were placed on review for possible downgrade:
* Corporate Family Rating -- B2
* Probability of Default Rating -- B2
* Second lien term loan -- Caa1
* Senior first lien term loan -- B1
* Senior first lien delayed draw term loan -- B1
* Senior first lien revolving credit facility -- B1
The last rating action for Cannery was on September 16, 2008, when
Moody's affirmed the company's B2 Corporate Family Rating and
upgraded its senior first lien bank loan to B1.
Cannery Casino Resorts, LLC is a privately held gaming company
that owns and operates one casino in Pennsylvania and three
casinos in Las Vegas, Nevada. The company currently generates
about $435 million of net revenue.
CANWEST MEDIA: Nonpayment of Interest Cues S&P's Rating Cut to D
----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered the corporate
credit rating to 'D' (default) from 'CCC' and the senior
subordinated debt rating to 'D' from 'CC' on Canwest Media Inc.
At the same time, S&P affirmed the 'CCC+' senior secured debt
rating on Canwest Media's wholly owned subsidiary Canwest Limited
Partnership. In addition, S&P affirmed the 'CC' senior
subordinated debt rating on Canwest LP. The recovery ratings on
all debt obligations are unchanged.
"The downgrade follows Canwest Media's nonpayment of
US$30.4 million in interest expense due March 15 on its 8% senior
subordinated notes due 2012," said Standard & Poor's credit
analyst Lori Harris. "In the unlikely event that the company
makes the payment within the 30-day cure period, S&P could raise
the ratings," Ms. Harris added. The interest payments on Canwest
LP's senior secured and senior subordinated debt remain current,
hence S&P haven't lowered the ratings on these issues to 'D'.
Canwest Media disclosed that it would like to complete a
recapitalization of the business. The company's senior secured
lenders have extended a previously approved waiver of certain
borrowing conditions, including compliance with financial
covenants, to April 7, 2009, to enable the company to continue
negotiations regarding the potential recapitalization.
CHEMTURA CORP: Adopts Executive and Key Employee Severance Plan
---------------------------------------------------------------
Edward P. Garden resigned as member of the board of Chemtura
Corporation on March 11, 2009. Two days later, on March 13,
Billie S. Flaherty was appointed a director of Chemtura.
Ms. Flaherty will serve as a director until the Annual Meeting of
Stockholders in 2009. Ms. Flaherty, 51, has served as Senior Vice
President, General Counsel and Secretary of Chemtura Corporation
since January 2009.
Mr. Garden served on the Environment, Health & Safety, Finance &
Pension, and Organization, Compensation and Governance committees
of the Board of Directors. The former member of the Board of
Directors did not resign from the Board of Directors as a result
of a disagreement with the Company on any matter relating to the
company's operations, policies or practices.
Meanwhile, the Organization, Compensation and Governance Committee
of the Board of Directors of the Company approved on Friday for
adoption the Chemtura Corporation Executive and Key Employee
Severance Plan in order to formalize its severance pay policy as
such policy applies to eligible employees of Chemtura and all of
the subsidiaries and affiliates of Chemtura.
A full-text copy of the CHEMTURA CORPORATION EXECUTIVE AND KEY
EMPLOYEE SEVERANCE PLAN, effective as of January 1, 2009, and last
amended, March 13, 2009, is available at no charge at:
http://ResearchArchives.com/t/s?3a51
Based in Middlebury, Connecticut, Chemtura Corporation (CEM) --
http://www.chemtura.com/-- with 2008 sales of $3.5 billion, is a
global manufacturer and marketer of specialty chemicals, crop
protection products, and pool, spa and home care products.
* * *
As reported by the Troubled Company Reporter on January 21, 2009,
Bloomberg News had said Chemtura Corp., and industry peers Ineos
Group Holdings, Georgia Gulf Corp. are crashing on a mountain of
takeover debt and may follow Lyondell Chemical Co. into
bankruptcy, based on the trading in their bonds. As to Ineos,
Georgia Gulf and Chemtura, Bloomberg said the combination of $11.7
billion in debt, frozen credit markets and the global recession
are forcing the companies to negotiate with creditors to loosen
terms of their loans. A glut in supplies that drove prices of
polypropylene down by half since October will make it even harder
for plastics makers to meet debt payments, just as manufacturers
in the Middle East add millions of tons of new supplies.
The TCR said February 9 that Moody's Investors Service lowered
Chemtura's Corporate Family Rating to B3 from B2, its PDR to Caa1
from B2 and lowered the company's outstanding debt ratings to B3.
The ratings of Chemtura remain under review for possible
downgrade. Despite the recent signing of $150 million three year
U.S. accounts receivable facility, Moody's remain concerned over
Chemtura's tight liquidity as evidenced by the maturity of the
waiver on the revolving credit facility on March 30, 2009 and
upcoming $370 million debt maturity due in early July 2009.
The TCR said on February 17 that Standard & Poor's Ratings
Services revised its ratings on Chemtura's senior unsecured notes
following an update to S&P's recovery analysis which incorporates
the company's $150 million reduction in its revolving credit
facility in January 2009 and following the company's Feb. 4, 2009,
press release regarding the subsidiary guarantee status for each
of its three senior unsecured note issuances. Standard & Poor's
affirmed its 'CCC' (same as the corporate credit rating) issue-
level rating on Chemtura's 6.875% senior notes due 2016. The
recovery rating on this issue was revised to '3' from '4',
indicating S&P's expectation for meaningful (50%-70%) recovery in
the event of a payment default.
CHESAPEAKE CORP: To Sell Assets to Irving; Auction Cancelled
------------------------------------------------------------
Chesapeake Corporation has received no qualifying bids to compete
with the offer to acquire all of its operating businesses
submitted by a group of investors, including affiliates of Irving
Place Capital Management, L.P., and Oaktree Capital Management,
L.P.
The deadline for submitting qualifying bids under the bid
procedures order entered by the U.S. Bankruptcy Court for the
Eastern District of Virginia in Richmond passed as of noon
(Eastern Time) March 17, 2009, with no other qualifying bids
submitted. As a result, the company has declared the investor
group the successful bidder and the auction scheduled to begin at
9:00 a.m. (Eastern Time) on Thursday, March 19, 2009, will not be
held.
The company will seek approval of the sale to the investor group
from the Bankruptcy Court during a hearing scheduled for 11:00
a.m. (Eastern Time) on Monday, March 23, 2009. The transaction
remains subject to the approval of the Bankruptcy Court under
Section 363(b) of the U.S. Bankruptcy Code and the satisfaction of
specified closing conditions, including the investor group
reaching definitive agreement on exit financing and obtaining
certain third-party and governmental approvals. Closing is also
conditioned on the material accuracy of the representations and
warranties of the parties; material compliance by the parties with
their obligations under the Asset Purchase Agreement among the
company, the U.S. Operating Subsidiaries and the Purchasers; and
the absence of a material adverse change with respect to the
company since September 28, 2008.
The company's financial advisor is Goldman, Sachs & Co., and its
restructuring advisor is Alvarez & Marsal. Chesapeake's legal
advisor in the U.S. is Hunton & Williams LLP.
As reported by the Troubled Company Reporter in January 2009,
Chesapeake reached a deal with a group of investors, including
affiliates of Irving Place Capital Management LP and Oaktree
Capital Management LP to sell itself for about $485 million,
without certain obligations.
The TCR said on March 4, 2009, that the Debtors' unsecured
creditors want an investigation on the proposed sale of the
Company, saying they had reservations as to whether the sale
negotiations were conducted in good faith. The official committee
of unsecured creditors said Chesapeake's requests for court
approval of its bankruptcy financing and sale procedures may have
been commenced for the benefit of Chesapeake, the lead group
bidding on its assets, and Wachovia, at the expense of the
unsecured creditors. The committee said it wanted to make sure
Chesapeake hadn't been improperly "coaxed" into selling all of its
assets.
Headquartered in Richmond, Virginia, Chesapeake Corporation (NYSE:
CSK) -- http://www.cskcorp.com-- supplies specialty paperboard
packaging products in Europe and an international supplier of
plastic packaging products to niche end-use markets. The Debtors
have 44 locations in Europe, North America, Africa and Asia and
employs approximately 5,400 people worldwide. The company
directly owns 100% of each of the other Debtors.
The company owns, directly or indirectly, 100% of each of the non-
debtor subsidiaries except: (i) Chesapeake Plastics Kft, a
Hungarian joint venture which is 49% owned by Chemark Kft; and
(ii) Rotam Boxmore Packaging Co. Ltd., a British Virgin Islands
company which is 50% owned by Canada Rotam International Co. Ltd.
The company's certificate of authorization authorizes the issuance
of 60,000,000 shares of common stock. About 20,559,115 shares of
common stock are issued and outstanding with par value of $1.00
per share as of Dec. 26, 2008. Moreover, the company's
certificate allows the issuance of 500,000 shares of preferred
stock, and no shares are outstanding.
As of Dec. 31, 2007, Dimensional Fund Advisors LLP owns 7.98% of
the company; T. Rowe Price Associates Inc., 8.4%; and Wells Fargo
& Company, 14.71%. Edelmann GmbH & Co. KG and Joachim W. Dziallas
owns 13.5% of the company as of Sept. 19, 2008.
New York Stock Exchange suspended the listing of the company's
common stock effective Oct. 8, 2008, due to its inability to meet
the global market capitalization requirements for continued
listing on the exchange. Subsequently, the company's stock began
to be quoted on the over-the-counter bulletin board under the
trading symbol "CSKE.PK."
Chesapeake Corporation, and 18 affiliates filed Chapter 11
petitions (Bankr. E.D. Virginia, Lead Case No. 08-336642) on
Dec. 29, 2008. Chesapeake has tapped Alvarez and Marsal North
America LLC, and Goldman Sachs & Co. as financial advisors.
It also brought along Tavenner & Beran PLC as conflicts counsel
and Hammonds LLP as special counsel. Its claims agent is Kurtzman
Carson Consultants LLC. The United States Trustee for Region 4
appointed seven creditors to serve on an Official Committee of
Unsecured Creditors for the Debtors' Chapter 11 cases.
As of September 30, 2008, Chesapeake's consolidated balance sheets
showed $936.4 million in total assets, including
$340.7 million in current assets; and $937.1 million in total
liabilities, including $469.2 million in current liabilities,
resulting in $500,000 in stockholders' deficit.
CHEYENNE KNIFE: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Cheyenne Knife Works, Inc.
102 Westview Road NW
Georgetown, TN 37336
Bankruptcy Case No.: 09-11427
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Eastern District of Tennessee (Chattanooga)
Judge: Judge R. Thomas Stinnett
Debtor's Counsel: Richard L. banks, Esq.
Richard Banks & Associates, PC
P. O. Box 1515
Cleveland, TN 37364-1515
(423)479-4188
Email: bmerriman@rbankslawfirm.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $100,001 to $500,000
A list of the Debtor's largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/tneb09--11427.pdf
The petition was signed by Thomas Davenport, president of the
Company.
CHRYSLER LLC: CEO Doubts Firm's Survival From Bankruptcy
--------------------------------------------------------
Bill Vlasic at The International Herald Tribune reports that
Chrysler LLC CEO and Chairperson Robert L. Nardelli doubts that
the Company could survive a government-sponsored bankruptcy.
IHT quoted Mr. Nardelli as saying, "I hope I'm wrong, but I don't
have a lot of confidence in today's environment that we can emerge
from bankruptcy."
According to IHT, Chrysler said that it might run out of money
without government assistance. The Company, says the report, is
asking the U.S. government for $5 billion in loans in addition to
$4 billion it had already received. The report states that the
auto task force is considering options to rescue Chrysler and
General Motors Corp. According to the report, members of the task
force met with Mr. Nardelli last week, toured a Chrysler truck
plant, and reviewed the Company's product plans.
IHT relates that Chrysler said in restructuring plans submitted to
the Treasury Department that it would require up to
$25 billion in government assistance if it were to file for
bankruptcy protection. Consumers might avoid Chrysler's cars,
trucks, and sport utility vehicles if the Company filed for
bankruptcy protection, IHT states, citing Mr. Nardelli.
Mr. Nardelli, according to IHT, said that the pensions for
Chrysler's retirees could also be threatened. The report quoted
Mr. Nardelli as saying, "You have no responsibility to the union
if you are bankrupt. I don't know that the PBGC [Pension Benefit
Guaranty Corporation] is going to put up the entire amount."
About Chrysler LLC
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital Management
LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles
and products. The company has dealers worldwide, including
Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil,
Venezuela, China, Japan and Australia.
* * *
As reported in the Troubled Company Reporter on Dec. 3, 2008,
Dominion Bond Rating Service downgraded the ratings of Chrysler
LLC, including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively. All trends are Negative. The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term. With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.
As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings on Chrysler
LLC, including the corporate credit rating, to 'CCC+' from 'B-'.
On July 31, 2008, TCR said that Fitch Ratings downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The
Rating Outlook is Negative. The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes. Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives. Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.
As reported in the TCR on Dec. 3, 2008, Dominion Bond Rating
Service downgraded on Nov. 20, 2008, the ratings of Chrysler LLC,
including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively. All trends are Negative. The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term. With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.
CHRYSLER LLC: Seeks to Cut Canadian Workers' Pay by 25%
-------------------------------------------------------
Chrysler LLC is seeking a deal to cut Canadian union workers'
compensation by as much as 25%, Dow Jones Newswires reports,
citing people familiar with the matter.
Chrysler, says Dow Jones, has held informal discussions with the
Canadian Auto Workers union. Dow Jones, citing people familiar
with the matter, states that Chrysler seeks to reduce the total
hourly compensation packages, including benefits, to $45 per hour
from $60. Dow Jones relates that CAW has yet to announce the
start of formal discussions with Chrysler.
According to Dow Jones, Chrysler could close down its Windsor,
Ontario minivan plant and pull other production out of Canada if
it fails to reach a deal on the compensation cut. Chrysler, Dow
Jones states, is considering transferring its production out of
its Windsor minivan plant. Dow Jones notes that it would take
Chrysler two weeks to shut the plant down.
Dow Jones relates that Chrysler must meet a March 31 deadline of
submitting to the U.S. Department of Treasury a list of its
agreed-to cost-cutting actions by its unions, suppliers,
executives, and dealers to access another $5 billion in low-
interest loans, which would be used to keep its operations running
and avert a bankruptcy filing. According to the report, Chrysler
is open to cutting benefits, including healthcare, rather than
actual wages.
CAW President Ken Lewenza said in a statement, "We are engaged in
a process of information sharing and exchange with both Chrysler
Canada and Ford Canada, so that both sides can better understand
each others' positions and accurately measure our current
situation. It is essential that this process continue, and we
will continue to negotiate with these two companies in a
respectful and confidential manner."
About Chrysler LLC
Headquartered in Auburn Hills, Michigan, Chrysler LLC --
http://www.chrysler.com/-- a unit of Cerberus Capital Management
LP, produces Chrysler, Jeep(R), Dodge and Mopar(R) brand vehicles
and products. The company has dealers worldwide, including
Canada, Mexico, U.S., Germany, France, U.K., Argentina, Brazil,
Venezuela, China, Japan and Australia.
* * *
As reported in the Troubled Company Reporter on Dec. 3, 2008,
Dominion Bond Rating Service downgraded the ratings of Chrysler
LLC, including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively. All trends are Negative. The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term. With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.
As reported in the Troubled Company Reporter on Aug. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings on Chrysler
LLC, including the corporate credit rating, to 'CCC+' from 'B-'.
On July 31, 2008, TCR said that Fitch Ratings downgraded the
Issuer Default Rating of Chrysler LLC to 'CCC' from 'B-'. The
Rating Outlook is Negative. The downgrade reflects Chrysler's
restricted access to economic retail financing for its vehicles,
which is expected to result in a further step-down in retail
volumes. Lack of competitive financing is also expected to result
in more costly subvention payments and other forms of sales
incentives. Fitch is also concerned with the state of the
securitization market and the ability of the automakers to access
this market on an economic basis over the near term, given the
steep drop in residual values, higher default rates, higher loss
severity being experienced and jittery capital market.
As reported in the TCR on Dec. 3, 2008, Dominion Bond Rating
Service downgraded on Nov. 20, 2008, the ratings of Chrysler LLC,
including Chrysler's Issuer Rating to CC from CCC (high).
Chrysler's First Lien Secured Credit Facility and Second Lien
Secured Credit Facility have also been downgraded to CCC and CC
(low) respectively. All trends are Negative. The ratings action
reflects Chrysler's challenge to maintain sufficient liquidity
balances amid severe industry conditions that have deteriorated
alarmingly over the past few months and are not expected to
improve in the near term. With this ratings action, Chrysler is
removed from Under Review with Negative Implications, where it was
placed on Nov. 7, 2008.
CITATION CORP: Aluminum Die Casting Unit Sold to Compass
--------------------------------------------------------
Compass Automotive Group, Inc., has acquired the aluminum die
casting and machining operations of Citation Corporation. Compass
will absorb the Citation business, located in Grand Rapids and
Lowell, Michigan, into its current die cast operations, which
produce highly engineered aluminum and magnesium components
utilized in steering, engine, and safety systems for nearly every
automaker in North America. Terms of the transaction were not
disclosed.
Compass, a portfolio company of Monomoy Capital Partners, L.P.,
operates a broad automotive platform that manufactures safety-
critical aluminum and magnesium automotive components utilizing
high pressure die casting, squeeze casting, and a proprietary
VRC/PRC casting process. Compass's principal customers include
Asian, European, and North American OEM's, as well as major Tier 1
suppliers.
"With efficient casting equipment and in-house machining
capability, Citation's operations are a great complement to the
Compass platform," said Jim Squatrito, CEO of Compass Automotive
Group. "Despite its current turmoil, the auto industry is here to
stay, and Compass will continue to seek additional market share
and assets as the automotive supply chain continues to
consolidate. The acquisition of these Citation facilities extends
our operations into machining and greatly expands our offering of
high-quality and cost-effective components to the industry."
"The Citation acquisition is an important further step in building
a strong Monomoy platform in the safety critical automotive
components manufacturing space," said Justin Hillenbrand, a
Monomoy partner. "The Grand Rapids and Lowell facilities are
valuable assets that will strengthen Compass in the short term and
position the Company to grow as the economy stabilizes. Compass
remains a financially stable business in a very difficult
industry, and Monomoy continues to review a compelling set of
acquisition opportunities in the automotive supply chain that can
add value and breadth to the Compass business platform."
About Compass Automotive
Based in Franklin, Indiana, Compass Automotive Group, LLC,
provides engineered component solutions to OEM's and Tier I
automotive suppliers. It was formed in July 2007 by Monomoy
Capital Partners, L.P., to consolidate safety critical component
manufacturers in the automotive supply chain. Compass is the
corporate parent of Casting Technologies Company, a casting
manufacturer utilizing proprietary squeeze casting and VRC/PRC
processes to produce safety critical, premium grade aluminum
suspension components, cross-members and compressor scrolls;
Magnesium Aluminum Corporation, a die cast manufacturer of
aluminum and magnesium steering wheels, steering components, and
airbag enclosures; and SRC, the leading North American
manufacturer of magnesium flux, a refining agent used in the
production of industrial aluminum and magnesium. Compass employs
more than 600 team members in Detroit and Fruitport, Michigan;
Franklin, Indiana; Cleveland, Ohio; Matamoras and Chihuahua,
Mexico; and produces parts for cars, motorcycles and light trucks
sold in North America, Europe and Asia.
About Monomoy Capital Partners
Monomoy Capital Partners, L.P. -- http://www.mcpfunds.com/-- is a
$280 million private equity fund that makes controlling
investments in middle market companies that require operational or
financial restructuring. Monomoy targets fundamentally sound
businesses with revenues of less than $300 million and acquires
businesses through bankruptcy proceedings, out-of-court
restructurings, corporate divestitures and other complex
transactions. The Fund has completed 21 transactions over the
past 36 months in the smaller end of the middle market and
currently owns 11 platform business that collectively employ more
than 9,000 people.
About Citation Corporation
Headquartered in Birmingham, Alabama, Citation Corporation --
http://www.citation.net/-- designs, develops and manufactures
cast, forged and machined components for the capital and durable
goods industries, including the automotive and industrial markets.
Citation uses aluminum, steel, gray iron, and ductile iron as the
raw materials in its various manufacturing processes. Citation
employs 2,900 in Alabama, Texas, Indiana, Michigan, North Carolina
and Wisconsin. The Debtor and its debtor-affiliates filed for
protection on Sept. 18, 2004 (Bankr. N.D. Ala. Case No. 04-08130).
Michael Leo Hall, Esq., and Rita H. Dixon, Esq., at Burr & Forman
LLP, represented the Debtors in their first bankruptcy. Judge
Tamara O. Mitchell confirmed the company's Second Amended Joint
Plan of Reorganization on May 18, 2005.
The Debtor and 11 debtor-affiliates filed a voluntary petition for
a prepackaged reorganization under Chapter 11 on March 12, 2007
(Bankr. N.D. Ala. Case Nos. 07-01153 to 07-01162). David S.
Heller, Esq., at Latham & Watkins LLP, and Michael Leo Hall, Esq.,
at Burr & Forman LLP, represented the Debtors. Carl Marks
Advisory Group LLC, the New York-based investment banking and
corporate revitalization firm, served as financial advisor.
Citation's schedules filed with the Court showed total assets of
$157,242,049 and total debts of $253,270,918.
Less than a month after Citation filed a voluntary petition for a
prepackaged reorganization under Chapter 11 in U.S. Bankruptcy
Court for the Northern District of Alabama, the company emerged
from bankruptcy on April 6, 2007.
Under its confirmed Plan of Reorganization, the company's lenders,
led by JPMorgan Chase & Co., exchanged $191 million in debt for
all reorganized company common stock and a new $30 million loan.
As reported by the TCR on Aug. 5, 2008, Standard & Poor's Ratings
Services has withdrawn its 'B' corporate credit rating and issue-
level ratings on Citation Corp. at the company's request. The
Novi, Mich.-based auto supplier had total balance sheet debt of
about $81 million as of March 31, 2008.
CITIGROUP INC: Lewis Alexander Leaves Co. to Join Treasury Dept.
----------------------------------------------------------------
David Enrich and Deborah Solomon at The Wall Street Journal report
that Lewis Alexander will leave Citigroup Inc. as its chief
economist to join the U.S. Treasury Department.
Mr. Alexander will head to Treasury "to work on domestic financial
issues," WSJ relates, citing Citigroup. According to WSJ, A
government official said that Mr. Alexander will be a counselor to
Treasury Secretary Timothy Geithner.
WSJ states that Mr. Alexander has been at Citigroup since 1999 and
before that worked at the Federal Reserve. He was the Commerce
Department's chief economist from 1993 through 1996, WSJ says.
According to WSJ, Mr. Alexander's role as Citigroup's chief
economist didn't involve significant management responsibilities,
but his optimistic economic forecasts affected executives' views
that the U.S. wouldn't face a prolonged slump. WSJ relates that
Mr. Alexander said in an interview on PBS on February 28, 2007, "I
think that's not going to spill over more broadly into the
economy, and so I think we're going to have a normal kind of
housing cycle that's going to last through the middle of this
year."
About Citigroup
Based in New York, Citigroup (NYSE: C) -- http://www.citigroup.com
-- is organized into four major segments -- Consumer Banking,
Global Cards, Institutional Clients Group, and Global Wealth
Management. Citigroup had $2.0 trillion in total assets on $1.9
trillion in total liabilities as of
Sept. 30, 2008.
As reported in the Troubled Company Reporter on Nov. 25, 2008, the
U.S. government entered into an agreement with Citigroup to
provide a package of guarantees, liquidity access, and capital.
As part of the agreement, the U.S. Treasury and the Federal
Deposit Insurance Corporation will provide protection against the
possibility of unusually large losses on an asset pool of
approximately $306 billion of loans and securities backed by
residential and commercial real estate and other such assets,
which will remain on Citigroup's balance sheet. As a fee for this
arrangement, Citigroup will issue preferred shares to the Treasury
and FDIC. In addition and if necessary, the Federal Reserve will
backstop residual risk in the asset pool through a non-recourse
loan.
CITIGROUP INC: CEO Pandit Got $1MM Salary, $37MM Stock in 2008
--------------------------------------------------------------
Citigroup Inc. said in a filing with the U.S. Securities and
Exchange Commission on Monday that CEO Vikram Pandit got a pay
package valued at $38.2 million in 2008.
Mike Barris and Bhattiprolu Murti at The Wall Street Journal
report that most of the $38.2 million amount was in stock and
options, whose value has withered with the Company's share price.
According to WSJ, Mr. Pandit took over as CEO in December 2007.
WSJ relates that Mr. Pandit got salary and perks less than
$1 million last year. WSJ states that Mr. Pandit got stock and
options valued at $37.3 million when granted in January 2008. The
grants, says the report, included a retention award of
$2.5 million in restricted stock, and a one-time signing award of
stock and stock options valued at $34.8 million.
WSJ relates that Mr. Pandit and other top Citigroup executives
refused bonuses or other incentive or retention compensation for
2008. According to the report, Mr. Pandit said he will accept $1
in base pay until Citigroup returns to profitability. Mr. Pandit
told workers last week that Citigroup was profitable in January
and February, the report says.
About Citigroup
Based in New York, Citigroup (NYSE: C) -- http://www.citigroup.com
-- is organized into four major segments -- Consumer Banking,
Global Cards, Institutional Clients Group, and Global Wealth
Management. Citigroup had $2.0 trillion in total assets on $1.9
trillion in total liabilities as of Sept. 30, 2008.
As reported in the Troubled Company Reporter on Nov. 25, 2008, the
U.S. government entered into an agreement with Citigroup to
provide a package of guarantees, liquidity access, and capital.
As part of the agreement, the U.S. Treasury and the Federal
Deposit Insurance Corporation will provide protection against the
possibility of unusually large losses on an asset pool of
approximately $306 billion of loans and securities backed by
residential and commercial real estate and other such assets,
which will remain on Citigroup's balance sheet. As a fee for this
arrangement, Citigroup will issue preferred shares to the Treasury
and FDIC. In addition and if necessary, the Federal Reserve will
backstop residual risk in the asset pool through a non-recourse
loan.
CITY OF VALLEJO: Can Terminate Union Contracts, Court Rules
-----------------------------------------------------------
The city of Vallejo, California, obtained a favorable ruling from
the U.S. Bankruptcy Court for the Eastern District of Virginia in
its request to reject union contracts in order to cut costs.
Judge Michael S. McManus issued an opinion in Vallejo's Chapter 9
case that that California law doesn't prevent municipalities in
bankruptcy reorganization from terminating labor contracts. He
held it would violate the U.S. Constitution if state law attempted
to prevent a city from utilizing any of the rights afforded by
Chapter 9, which contains the reorganization provision in
bankruptcy law applicable to governmental units. Judge McManus
also concluded that the more cumbersome provisions for terminating
labor contracts that are applicable to companies in Chapter 11
don't apply to municipalities.
About the City of Vallejo
Vallejo -- http://www.ci.vallejo.ca.us/GovSite-- is a city in
Solano County, in California. As of the 2000 census, the city had
a total population of 116,760. It is located in the San Francisco
Bay Area on the northern shore of San Pablo Bay.
The City is a charter city organized and exercising governmental
functions under its charter and the laws and constitution of the
state. Its governing body is its City Council.
The City filed for protection under Chapter 9 of the U.S.
Bankruptcy Code on May 23, 2008 (Bankr. E.D. Calif. Case No.
08-26813). Marc A. Levinson, Esq., and Norman C. Hile, Esq., at
Orrick, Herrington & Sutcliffe LLP in Sacramento, California,
represent the City.
According to Vallejo's comprehensive annual report for the year
ended June 30, 2007, the city has $983 million in assets and
$358 million in debts.
COLEMAN CABLE: S&P Gives Negative Outlook, Affirms 'BB-' Ratings
----------------------------------------------------------------
Standard & Poor's Rating Services said it revised its outlook on
Waukegan, IllInois-based Coleman Cable Inc. to negative from
stable. S&P affirmed all the ratings, including the 'BB-'
corporate credit rating. Coleman designs and manufactures
electrical wire and cable products primarily in the U.S. Debt
outstanding as of Dec. 31, 2008, totaled about $273 million.
"The outlook revision reflects our concerns that Coleman's credit
metrics could deteriorate materially during this year if current
challenging operating conditions persist through the latter half
of 2009," said Standard & Poor's credit analyst Susan Madison.
Operating lease-adjusted debt to latest-12-month adjusted EBITDA
totaled 4.8x at Dec. 31, 2008, up from 4.3x at the end of
September, reflecting very weak fourth-quarter performance. "We
expect this metric to weaken further," said Ms. Madison, "given
our expectations for the difficult operating environment to
continue at least through the first half of 2009." However,
despite the profit declines, Coleman has generated significant
cash flow which it has used to reduce debt over the past six
months, liquidity is adequate, and no maintenance financial
covenants are currently in effect.
CONSECO INC: Delays Filing of Annual Report on Form 10-K
--------------------------------------------------------
Conseco, Inc., has not completed its financial statements for the
year ended December 31, 2008. Conseco informed the Securities and
Exchange Commission it expects to complete its financial
statements and to file its Form 10-K on or before March 31, 2009.
As reported by the Troubled Company Reporter on March 4, 2009, the
Company has been informed by its independent registered public
accounting firm that without additional information and analysis
to satisfy the auditors' concerns regarding the Company's
liquidity and debt covenant margins -- primarily those that could
be impacted by a significant amount of additional realized losses
in the Company's investment portfolio -- their audit opinion will
include an explanatory paragraph regarding the Company's ability
to continue as a going concern. The Company is continuing to
provide information and analysis to address those concerns.
According to Conseco, if, after considering the additional
information to be provided by the Company, it is concluded that
there is substantial doubt as to the Company's ability to continue
as a going concern, the auditors' report on the consolidated
financial statements for the year ended December 31, 2008, will
include an explanatory paragraph to that effect. The inclusion of
such a paragraph would constitute a default under the Company's
Second Amended and Restated Credit Agreement dated October 10,
2006, as amended, which would allow the lenders to accelerate
payment of the principal amount of and accrued but unpaid interest
on the debt borrowed thereunder if the Company cannot correct the
default or obtain a waiver from the lenders within 30 days.
As of December 31, 2008, the principal amount of the debt
thereunder was $911.8 million. If the lenders accelerate the debt
under the Credit Agreement, holders of the Company's 3.50%
Convertible Debentures due September 30, 2035 issued under the
August 15, 2005 indenture can also accelerate payment of the
principal amount of the debentures plus accrued and unpaid
interest thereon. As of December 31, 2008, the principal amount
of the debt thereunder was $293.0 million. Similarly, if the
lenders accelerate the debt under the Credit Agreement, the holder
of the Company's 6% Senior Note due November 12, 2013, can
accelerate payment of the principal amount outstanding plus
accrued and unpaid interest thereon. As of December 31, 2008, the
principal amount thereunder was $125.0 million.
The Company expects to report a net loss applicable to common
stock of $406.8 million in the quarter ended December 31, 2008,
compared to a loss of $71.5 million in the same period of the
prior year.
In the fourth quarter of 2008, the Company expects to recognize
losses (net of income taxes) from discontinued operations of
approximately $368 million primarily related to losses and
transaction costs associated with the transfer of Senior Health
Insurance Company of Pennsylvania to an independent trust. In
addition, the Company expects to report net realized investment
losses (net of amortization and taxes) in the quarterly period
ended December 31, 2008, of $57 million, compared to losses of
$23.8 million in the same period in the prior year. The Company
also expects to increase the valuation allowance for deferred tax
assets by $31 million in the fourth quarter of 2008 compared to
$68.0 million in the same period in the prior year as it is more
likely than not that tax benefits related to investment losses
will not be utilized to offset future taxable income.
A Preliminary View of Conseco Inc.'s Fourth Quarter 2008 Financial
and Operating Results is available at no charge at:
http://ResearchArchives.com/t/s?3a67
Headquartered in Carmel, Indiana, Conseco Inc. (NYSE: CNO) --
http://www.conseco.com/-- is the holding company for a group of
insurance companies operating throughout the United States that
develop, market and administer supplemental health insurance,
annuity, individual life insurance and other insurance products.
The company became the successor to Conseco Inc. (Old Conseco), in
connection with its bankruptcy reorganization. CNO focuses on
serving the senior and middle-income markets. The company sells
its products through three distribution channels: career agents,
professional independent producers and direct marketing. CNO
operates through its segments, which includes Bankers Life,
Conseco Insurance Group, Colonial Penn, other business in run-off
and corporate operations.
* * *
As reported in the Troubled Company Reporter on Jan. 6, 2009,
Fitch Ratings has downgraded the ratings assigned to Conseco Inc.
The rating outlook on Conseco Inc. and its subsidiaries remains
negative. Fitch downgraded these ratings: (i) issuer default
rating to 'BB-' from 'BB'; (ii) senior secured bank credit
facility to 'BB-' from 'BB+'; and (iii) senior unsecured debt to
'B' from 'BB-'.
COOPER COAL: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Cooper Coal, Inc.
437 South Holston Dam Road
Bristol, TN 37620
Bankruptcy Case No.: 09-70520
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of Virginia (Roanoke)
Judge: William F. Stone, Jr.
Debtor's Counsel: Robert Tayloe Copeland, Esq.
Copeland & Bieger, P.C.
P.O. Box 1296
Abingdon, VA 24212
Tel: (276) 628-9525
Fax: (276) 628-4711
Email: rcopeland@copelandbieger.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of 20 largest unsecured creditors
together with its petition.
The petition was signed by David C. Cooper, president of the
Company.
CRC3 INC: Voluntary Chapter 11 Case Summary
-------------------------------------------
Debtor: CRC3, Inc.
fka Guywheel Development
251 Moser Ave. #305
Bullhead City, AZ 86429
Bankruptcy Case No.: 09-04185
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
District of Arizona (Yuma)
Debtor's Counsel: Michael Reddig, Esq.
Reddig Law Office
P.O. Box 22143
Flagstaff, AZ 86002
Tel: 928-774-9544
Fax : 928-774-2043
Email: mreddig@theriver.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/azb09-04185.pdf
The petition was signed by John Wheeler, president of the Company.
CYNTHIA IANNARELLI: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Cynthia Iannarelli
3132 Millers Run Road
Cecil, PA 15321
Bankruptcy Case No.: 09-21503
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of Pennsylvania (Pittsburgh)
Debtor's Counsel: Robert O. Lampl, Esq
960 Penn Avenue, Suite 1200
Pittsburgh, PA 15222
Tel: (412) 392-0330
Fax: (412) 392-0335
Email: rol@lampllaw.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor did not file a list of 20 largest unsecured creditors
together with its petition.
The petition was signed by Cynthia Iannarelli.
DANIEL INIGUEZ: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Daniel Iniguez
2413 Decker Lane
Livermore, CA 94550
Bankruptcy Case No.: 09-41759
Debtor-affiliate filing separate Chapter 11 petition on
November 18, 2008:
Entity Case No.
------ --------
USBK Oakland Division 08-46752
Chapter 11 Petition Date: March 6, 2009
Court: United States Bankruptcy Court
Northern District of California (Oakland)
Judge: Randall J. Newsome
Debtor's Counsel: Phyllis N. Voisenat, Esq.
Law Offices of Phyllis N. Voisenat
1330 Broadway #1035
Oakland, CA 94612
Tel: (510) 272-9410
Email: pvoisenat@gmail.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/canb09-41759.pdf
The petition was signed by Daniel Iniguez.
DARROW AUTOMOTIVE: Sent to Ch. 7 Liquidation by 4 Creditors
-----------------------------------------------------------
Rich Kirchen at The Business Journal of Milwaukee reports that
four creditors have filed a Chapter 7 bankruptcy petition against
Russ Darrow III's Darrow Automotive Group Inc. in the U.S.
Bankruptcy Court for the Eastern District of Wisconsin.
Business Journal relates that the Hon. Susan Kelley will handle
the case.
According to Business Journal, the creditors claimed that Darrow
Automotive owes them a combined $786,469.
Business Journal states that this is the second involuntary
bankruptcy case involving Darrow III's dealerships. The report
says that on January 26, three creditors in Georgia filed a
similar involuntary bankruptcy petition against Darrow III,
listing a debt of more than $15.5 million.
Darrow Automotive Group Inc. -- http://www.darrowusa.com/-- is a
dealership founded by Russ Darrow III.
DAYTON SUPERIOR: Maturity of $250MM in Loans Moved to March 23
--------------------------------------------------------------
Dayton Superior Corporation on March 16, 2009, entered into:
(i) Amendment No. 1 to its $150.0 million Revolving Credit
Agreement with various lenders and General Electric
Capital Corporation, as Administrative Agent, in
connection with the Revolving Credit Agreement, dated as
of March 3, 2008; and
(ii) Amendment No. 2 to its $100.0 million Term Loan Credit
Agreement with various lenders and GECC, as Administrative
Agent, in connection with the Term Loan Credit Agreement,
dated as of March 3, 2008.
Pursuant to the Amendments, (i) the scheduled maturities under the
Credit Agreements have been extended until March 23, 2009 and (ii)
the interest rates under the Credit Agreements will be increased:
(a) under the Revolving Credit Agreement, the new interest
rate will be, at the Company's option, ABR plus 5.50% or
LIBOR plus 6.50% (with up to 4.00% of the total interest
rate paid-in-kind at the company's option), plus an
additional 1.50% on Special Overadvances, and
(b) under the Term Loan Credit Agreement, the new interest
rate will be, at the Company's option, ABR plus 11.50% or
LIBOR plus 12.50% (with up to 8.00% of the total interest
rate paid-in-kind at the Company's option).
During this initial extension period, the Company expects to
continue negotiations with the Agent and the Lenders on the terms
of a more comprehensive amendment or forbearance arrangement.
A full-text copy of Amendment No. 1 to the Revolving Credit
Agreement, dated as of March 16, 2009, is available at no charge
at: http://ResearchArchives.com/t/s?3a65
A full-text copy of Amendment No. 2 to the Term Loan Credit
Agreement, dated as of March 16, 2009, is available at no charge
at: http://ResearchArchives.com/t/s?3a66
The company is continuing to evaluate possible strategic
alternatives to enhance stockholder value, including the possible
sale of the company or a controlling interest in the company.
The company has retained Harris Williams & Co. to assist in the
evaluation process. Dayton Superior has also agreed with Morgan
Stanley & Co. Incorporated to end its relationship with Morgan
Stanley and the company has retained Moelis & Company LLC to
advise on options to refinance or otherwise restructure the
company's outstanding indebtedness. The credit agreement
amendments will provide the company with additional time to
evaluate its alternatives.
About Dayton Superior
Headquartered in Dayton, Ohio, Dayton Superior Corporation
(NASDAQ:DSUP) -- http://www.daytonsuperior.com/-- is a North
American provider of specialized products consumed in non-
residential, concrete construction, and a concrete forming and
shoring rental company serving the domestic, non-residential
construction market. The company's products are used in non-
residential construction projects, including infrastructure
projects, such as highways, bridges, airports, power plants and
water management projects; institutional projects, such as
schools, stadiums, hospitals and government buildings, and
commercial projects, such as retail stores, offices and
recreational, distribution and manufacturing facilities. Dayton
Superior offers more than 20,000 catalogued products.
* * *
As reported by the Troubled Company Reporter on January 28, 2009,
Standard & Poor's Rating Services said it lowered its ratings on
Dayton Superior Corp. S&P lowered the corporate credit rating to
'CCC' from 'CCC+' and removed all ratings from CreditWatch, where
they were placed with negative implications on Aug. 14, 2008. The
outlook is negative.
DAYTON SUPERIOR: Extends Debt Exchange Offer Until April 9
----------------------------------------------------------
Dayton Superior Corporation has extended the exchange expiration
date for its private exchange offer with respect to its 13% Senior
Subordinated Notes due 2009 and concurrent consent solicitation.
The exchange expiration date has been extended until 11:59 p.m.
EDT, on April 9, 2009. The exchange expiration date had been
scheduled for 11:59 p.m. EDT, on March 13, 2009. The withdrawal
expiration date expired at 11:59 p.m. EST, December 1, 2008, and
has not been extended. The early consent deadline expired at 5:00
p.m. EDT, on July 25, 2008, and has not been extended.
As of the close of business on March 12, 2009, approximately
$9.6 million in aggregate principal amount of the 13% Senior
Subordinated Notes due 2009 have been tendered and not withdrawn.
The exchange offer is being made only to qualified institutional
buyers and institutional accredited investors inside the United
States and to certain non-U.S. investors located outside the
United States.
About Dayton Superior
Headquartered in Dayton, Ohio, Dayton Superior Corporation
(NASDAQ:DSUP) -- http://www.daytonsuperior.com/-- is a North
American provider of specialized products consumed in non-
residential, concrete construction, and a concrete forming and
shoring rental company serving the domestic, non-residential
construction market. The company's products are used in non-
residential construction projects, including infrastructure
projects, such as highways, bridges, airports, power plants and
water management projects; institutional projects, such as
schools, stadiums, hospitals and government buildings, and
commercial projects, such as retail stores, offices and
recreational, distribution and manufacturing facilities. Dayton
Superior offers more than 20,000 catalogued products.
* * *
As reported by the Troubled Company Reporter on January 28, 2009,
Standard & Poor's Rating Services said it lowered its ratings on
Dayton Superior Corp. S&P lowered the corporate credit rating to
'CCC' from 'CCC+' and removed all ratings from CreditWatch, where
they were placed with negative implications on Aug. 14, 2008. The
outlook is negative.
DEGROATE PETROLEUM: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Degroate Petroleum Services, Inc.
441 Degroate Road
New Lenox, IL 60451
Bankruptcy Case No.: 09-07427
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Judge: Eugene R. Wedoff
Debtor's Counsel: Thomas W. Toolis, Esq.
Jahnke & Toolis, LLC
9031 West 151st Street, Suite 203
Orland Park, IL 60462
Tel: (708) 349-9333
Fax: (708) 349-8333
Email: twt@jtlawllc.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/ilnb09-07427.pdf
The petition was signed by Scott DeGroate, President of the
company.
DOLE FOOD: Fitch Upgrades Long Term IDR to 'CCC'
------------------------------------------------
Fitch Ratings has taken these rating actions on the debt of Dole
Food Company, Inc., and its subsidiary Solvest Ltd.:
Fitch has upgraded these ratings:
Dole Food Company, Inc. (Operating Company)
-- Long-term Issuer Default Rating to 'CCC' from 'CC';
-- Secured asset-based revolver to 'B+/RR1' from 'B/RR1';
-- Secured term loan B to 'B+/RR1' from 'B/RR1'.
Solvest Ltd. (Bermuda-based Subsidiary)
-- Long-term IDR to 'CCC' from 'CC';
-- Secured term loan C to'B+/RR1' from 'B/RR1'.
Fitch has assigned this rating:
Dole Food Company, Inc. (Operating Company)
-- Third-lien secured notes 'CCC/RR4'.
Lastly, Fitch has affirmed Dole's senior unsecured debt rating and
revised the recovery rating down:
Dole Food Company, Inc. (Operating Company)
-- Senior unsecured debt to 'C/RR6' from 'C/RR5'.
The Outlook is Negative.
These rating actions affect Dole's approximately $2.2 billion in
consolidated debt at the year ended Jan. 3, 2009.
The upgrade is due to Dole's ability to refinance its $345 million
8 5/8% senior notes due May 1, 2009, with the issuance of
$350 million 13 7/8% privately-placed five-year notes due
March 15, 2014. The new notes are secured by a third priority
lien on all of its U.S. assets, are guaranteed by domestic
subsidiaries and contain a change of control put at 101% of
principal plus interest. Proceeds from the offering along with
cash on hand or revolver availability are being used to fund the
consent and cash tender offer for Dole's unsecured notes due in
2009. As of March 13, 2009, 72% or $248.2 million of aggregate
principal notes have been tendered. Dole has extended the consent
solicitation and cash tender offer deadline to 12:00 midnight on
March 17, 2009. If 100% of the notes are not tendered, Fitch
expects Dole to redeem any outstanding 8 5/8% notes on or before
the May 1, 2009 maturity date.
The Negative Outlook reflects Fitch's continued concern regarding
liquidity and refinancing risk for Dole. Although the company
solved its 2009 maturity, additional upcoming obligations include
$400 million 7 1/4% notes due June 15, 2010 and $200 million 8
7/8% due in 2011. Dole's leverage has improved from a peak of 8.3
times (x) on Dec. 29, 2007 but total debt-to-operating EBITDA on
Jan. 3, 2009 remains high at 5.7x. Futhermore, Dole continues to
generate negative free cash flow (cash flow from operations less
capital expenditures and dividends).
For the year ended Jan. 3, 2009, Dole generated $386 million of
EBITDA excluding a $27 million net gain on asset sales, up from
$290 million during the previous year. Operating free cash flow,
however, was negative $54 million. On Jan. 3, 2009, Dole's
liquidity consisted of $91 million of cash and $173 million of
revolver availability. Dole's operating performance and liquidity
continues to benefit from strong worldwide banana pricing, reduced
bunker fuel shipping costs and asset sales. If Dole successfully
refinances its 2010 maturity and its operating and financial
performance does not deteriorate, Fitch may revise the ratings and
the Outlook.
Fitch has assigned a RR4 Recovery Rating to Dole's new third-lien
secured notes and has reduced its Recovery Rating for Dole's
existing senior unsecured debt to RR6. The RR4 rating indicates
average recovery prospects of 31%-50% in a distressed situation,
while the RR6 predicts recovery prospects of less than 10%. The
position of Dole's unsecured debt, which will represent
approximately 34% of its debt balance once the 2009 notes are
repayed, has been subordinated as a result of Dole's secured debt
issuance. Fitch continues to view Dole's priority bank debt as
having outstanding recovery prospects of 91%-100%.
In conjunction with the secured note issuance, Dole amended the
terms of its secured credit facilities and the indenture governing
its 2009 notes. The supplemental indenture eliminates most
restrictive covenants while the amendment to the credit facilities
allows Dole to issue notes secured by junior liens on certain of
its U.S. assets. The amount issued, however, cannot exceed the
greater of $500 million or a quantity that when added to existing
senior secured debt equals 3.75x the last 12 months earnings
before interest, taxes, depreciation and amortization (EBITDA).
Fitch estimates Dole's secured leverage ratio, after its $350
million secured note offering, at approximately 3.5x. Given
higher pricing on the amended bank facility and the new notes,
Dole's gross interest expense will increase materially.
Other changes to Dole's credit facilities include, but are not
limited to, the addition of a new restricted payments basket of up
to $50 million to be used to prepay its senior notes due 2009 and
2010 and a first priority secured leverage maintenance covenant to
the term loan facilities. The amendment also permits Dole to
exclude up to EUR45 million of debt-financed payments related to
the European Commission fine from its limitation on indebtedness
covenant. Residual payments associated with this fine are due
April 1, 2009.
DOLPHIN ISLAND: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Dolphin Island Preservation, LLC
P.O. Box 15057
Savannah, GA 31416
Bankruptcy Case No.: 09-40502
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Southern District of Georgia (Savannah)
Debtor's Counsel: Richard C. E. Jennings, Esq.
Law Offices Of Skip Jennings, PC
115 W. Oglethorpe Ave.
Savannah, GA 31401
Tel: (912) 234-6872
Fax: (912) 236-7549
Email: skipjenningspc@comcast.net
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/gasb09-40502.pdf
The petition was signed by Dolphin Island Management, LLC.
ECONOMIC INVENTIONS: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Economic Inventions, LLC
29 Thomas Coke Drive
Waynesville, NC 28785-5911
Bankruptcy Case No.: 09-10242
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of North Carolina (Asheville)
Judge: George R. Hodges
Debtor's Counsel: James H. Henderson, Esq.
James H. Henderson, P.C.
1201 Harding Place
Charlotte, NC 28204-2248
Tel: (704) 333-3444
Fax: (704) 333-5003
Email: henderson@title11.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/ncwb09-10242.pdf
The petition was signed by Vergil Daughtery, Managing Director of
the company.
EMPLOYMENT GIANT: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Employment Giant, LLC
6476 Marlette Street
Marlette, MI 48453
Bankruptcy Case No.: 09-46390
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Judge: Thomas J. Tucker
Debtor's Counsel: Marla Lynn Howell, Esq.
DeCaro & Howell, P.C.
14406 Old Mill Road, Suite 201
Upper Marlboro, MD 20772
Tel: (301) 464-1400
Fax: (301) 464-4776
Email: mhowell@decarohowell.com
Estimated Assets: $500,001 to $1,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Debtor's largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/mieb09-46390.pdf
The petition was signed by Dennis Squires, Managing Member of the
company.
ENERGY PARTNERS: S&P Downgrades Corporate Credit Rating to 'CCC-'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said that it lowered its
corporate credit rating on independent exploration and production
firm Energy Partners Ltd. to 'CCC-' from 'CCC+'. At the same
time, Standard & Poor's lowered its ratings on EPL's senior
unsecured issues to 'CC' from 'CCC'. The recovery ratings on
EPL's unsecured issues remain unchanged at '5'. The outlook is
negative.
"The ratings action follows several announcements released,
including the potential for EPL to pursue a debt restructuring in
the near term," said Standard & Poor's credit analyst Jeffery B.
Morrison. "As part of the company's strategic review that was
announced in February, the company has been in discussions with an
Ad Hoc Committee representing the holders of a majority of its
$450 million principal amount of senior unsecured notes regarding
the terms of a possible debt for equity exchange."
The outlook is negative. S&P would likely lower EPL's corporate
rating to 'SD' and the ratings on affected issues to 'D' if the
company pursues a debt for equity exchange in the near term. In
addition, if EPL is not able to complete a debt for equity
exchange and/or remedy issues related to its senior credit
facility (specifically its $38 million borrowing base deficiency
and receiving amendments and waivers for potential financial
covenant violations), S&P believes the company will find it
difficult to remain a going concern in the near term.
ENERGY XXI: S&P Changes Outlook to Negative; Affirms 'B-' Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised the
outlook on Energy XXI (Bermuda) Ltd. to negative from stable and
affirmed the 'B-' corporate credit rating on the company. At the
same time, the issue rating on Energy XXI Gulf Coast Inc.'s
$750 million 10% senior unsecured notes was affirmed at 'CCC+',
with a recovery rating of 5, implying modest (10%-30%) recovery in
case of a payment default. Energy XXI Gulf is a subsidiary of
Energy XXI (Bermuda).
"The outlook revision reflects Standard & Poor's concerns
regarding the company's tightening liquidity given current
commodity prices, weaker future cash flows following the
monetization of its hedges, potential reduction in its borrowing
base as it goes through the next redetermination process in April
2009, and its aggressive leverage, which S&P expects to worsen
with the softer commodity prices," said Standard & Poor's credit
analyst Aniki Saha-Yannopoulos.
The ratings on Energy XXI reflect its short operating history,
high debt leverage, elevated cost structure, aggressive growth
strategy, and small reserve base concentrated in the capital-
intensive Gulf of Mexico region. Mitigating factors include an
experienced management team and a hedging program to protect cash
flows.
Standard & Poor's considers Energy XXI's business risk profile
vulnerable, reflecting the company's short operating history and
small reserve base concentrated in the Gulf of Mexico. Another
primary ratings concern is a high cost structure that hampers
profitability and cash flows.
EQUAN REALTY: Court OKs Gregory Messer as Chapter 11 Trustee
------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has approved the appointment by Diana G. Adams, the United States
Trustee for Region 2, of Gregory Messer as Chapter 11 trustee in
Equan Realty Corporation's bankruptcy case.
Gregory Messer assures the Court that he does not have any
interest materially adverse to the interests of the Debtor's
estate, or any class of creditors or equity security holders by
reason of any direct or indirect relationship with the Debtor and
that he is a "disinterested person" as that term is defined in
Sec. 101(14) of the U.S. Bankruptcy Code.
Gregory Messer, Esq., of the Law Office of Gregory Messer, PLLC,
is Board Certified in Consumer Bankruptcy by the Bankruptcy Board
of Certification since 1995. Atty. Messer's professional
affiliations also include being a Panel Member, Chapter 7 Trustee
Panel, Eastern and Southern District of New York from 1980 to the
present.
Based in New York City, Equan Realty Corp. filed for Chapter 11
relief on Oct. 14, 2008 (Bankr. S.D. N.Y. Case No. 08-14017).
When the Debtor filed for protection from its creditors, it listed
total assets of $10,755,997, and total debts of $5,884,523. Fred
Stevens, Esq., at Fox Rothschild LLP, represents the Debtor as
counsel. The Chapter 11 trustee has selected Gary Frederick
Herbst, Esq., at LaMonica Herbst & Maniscalco as its counsel.
EZRI NAMVAR: Namco Capital Owes $545 Million to 464 Creditors
-------------------------------------------------------------
Court documents say that Ezri Namvar's main company, Namco Capital
Group Inc., owes $545 million to 464 creditors.
According to court documents, Namco Capital's assets are valued at
$671 million, which means Mr. Namvar's assets exceed liabilities
by $126 million.
Daniel Miller at Los Angeles Business Journal relates that Seong
Kim, who was not involved in the involuntary bankruptcy action but
is representing a creditor of Mr. Namvar, said, "People can throw
you into bankruptcy, even if you do have enough assets to pay off
debts (if) you are not paying off debt."
Court documents state that the asset values are from Mr. Namco's
internal accounting and have not been verified for accuracy.
An asset list distributed in November 2008 during out-of-court
settlement talks showed that Mr. Namvar and Namco Capital stated
assets totaling $1.55 billion, far smaller than a less detailed
July 2008 asset list that assigned a $2.43 billion market value to
the holdings, The Business Journal relates. According to the
report, the internal lists identify the holdings as those of Mr.
Namvar and Namco Capital.
Court documents show eight transfers of Namco Capital properties,
which are valued at $10.5 million, to creditors that were made in
the 90 days before the bankruptcy filing. The report states that
the transactions could be unwound if they are found to support
preferential payments.
According to court documents, Namco Capital claimed that it is
owed by 224 limited liability firms, special purpose entities, and
individuals. Mr. Namvar, says Business Journal, established
entities to hold real estate, and many of the LLCs were on the
internals lists. Mr. Namvar also listed in court documents
relatives including his four children and at least one brother,
who owe Mr. Namco a total of $246 million.
Business Journal quoted A. David Youssefyeh, the attorney for
creditors, as saying, "I'm not surprised. In spite of the
assertions of Mr. Namvar and his brothers over the last couple of
months, this is just more proof Mr. Namvar worked in concert with
his family members and that they were all one in the same."
Mr. Namvar, according to court documents, listed unsecured
creditors that include:
-- Abraham Assil,
-- Benjamin Efraim, and
-- Arash Hakhamian.
Ezri Namvar, Chairman, CEO, is founder and principal shareholder
of Namco Capital Group, Inc., a privately held holding company for
companies engaged in real estate investments and financial
services. The cases are In re Ezri Namvar, 08-32349, and Namco
Capital Group Inc., 08-32333, (Bankrupt. D. Cal.).
FABTECH INDUSTRIES: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Fabtech Industries Inc.
fka David J. Winner Enterprises, Inc
aka Fabtech Motor Sports
fdba Fabtech Engineering
4331 Eucalyptus Avenue
Chino, CA 91710
Bankruptcy Case No.: 09-14185
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Central District of California (Riverside)
Judge: Sheri Bluebond
Debtor's Counsel: Steven R. Fox, Esq.
17835 Ventura Blvd Ste 306
Encino, CA 91316
Tel: 818-774-3545
Fax : 818-774-3707
Email: emails@foxlaw.com
Total Assets: $7,333,686
Total Debts: $9,456,668
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/cacb09-14185.pdf
The petition was signed by David J. Winner, CEO of the Company.
FANNIE MAE: Barney Frank to Submit Bill for Co.'s Restructuring
---------------------------------------------------------------
House Financial Services Committee chairperson Barney Frank said that
he hopes to submit a bill
later this year to restructure Fannie Mae and Freddie Mac, James R.
Hagerty and Michael M.
Phillips at The Wall Street Journal report.
WSJ relates that Mr. Frank urged housing-related organizations on
Tuesday to send him their ideas
for reconfiguring Fannie Mae and Freddie Mac. WSJ quoted Mr. Frank as
saying, "The current
model is broken." Mr. Frank, according to the report, said that
Fannie Mae and Freddie Mac could
be separated into entities serving these functions:
-- to ensure adequate funding for the home-mortgage market
as a whole, and
-- provide government subsidies for housing low-income
people.
According to WSJ, some people have called for turning Fannie Mae and
Freddie Mac into
cooperatives owned by mortgage lenders, while others have suggested
making the companies
public utilities, which would involve very tight regulation and limits
on their return on equity. WSJ
states that Arizona State University finance professor Anthony Sanders
recommends leaving Fannie
Mae and Freddie Mac intact but subjecting them to better regulation
and requiring them to hold
more capital. Mr. Sanders also suggested preventing Freddie Mac and
Fannie Mae from holding
large amounts of mortgages and related securities so that the two
companies would focus on
creating and guaranteeing mortgage securities that would be held by others.
About Fannie Mae
The Federal National Mortgage Association -- (FNMA) (NYSE: FNM) --
commonly known as
Fannie Mae, is a shareholder-owned U.S.
government-sponsored enterprise. Fannie Mae has a federal charter and
operates in America's
secondary mortgage market, providing mortgage bankers and other
lenders funds to lend to home
buyers at low rates.
Fannie Mae was created in 1938, under President Franklin D.
Roosevelt, at a time when millions of families could not become
homeowners, or risked losing their homes, for lack of a consistent
supply of mortgage funds across
America. The government established Fannie Mae to expand the flow of
mortgage funds in all
communities, at all times, under all economic conditions, and to help
lower the costs to buy a
home.
In 1968, Fannie Mae was re-chartered by the U.S. Congress as a
shareholder-owned company, funded solely with private capital
raised from investors on Wall Street and around the world.
Fannie Mae is the U.S. largest mortgage buyer, according to The
New York Times.
Conservatorship
As reported by the Troubled Company Reporter, the U.S. government
took direct responsibility for Fannie Mae and Freddie Mac, placing the
government sponsored
enterprises under conservatorship on September 7, 2008. James B.
Lockhart, director of Federal
Housing Finance Agency, said that Fannie Mae and Freddie Mac share the
critical mission of
providing stability and liquidity to the housing market. Between
them, the Enterprises have $5.4
trillion of guaranteed mortgage-backed securities (MBS) and debt
outstanding, which is equal to
the publicly held debt of the United States. Among the key components
of the conservatorship, the
FHFA, as conservator, assumed the power of the Board and management.
FREDDIE MAC: Barney Frank to Submit Bill for Co.'s Restructuring
----------------------------------------------------------------
House Financial Services Committee chairperson Barney Frank said that
he hopes to submit a bill
later this year to restructure Fannie Mae and Freddie Mac, James R.
Hagerty and Michael M.
Phillips at The Wall Street Journal report.
WSJ relates that Mr. Frank urged housing-related organizations on
Tuesday to send him their ideas
for reconfiguring Fannie Mae and Freddie Mac. WSJ quoted Mr. Frank as
saying, "The current
model is broken." Mr. Frank, according to the report, said that
Fannie Mae and Freddie Mac could
be separated into entities serving these functions:
-- to ensure adequate funding for the home-mortgage market
as a whole, and
-- provide government subsidies for housing low-income
people.
According to WSJ, some people have called for turning Fannie Mae and
Freddie Mac into
cooperatives owned by mortgage lenders, while others have suggested
making the companies
public utilities, which would involve very tight regulation and limits
on their return on equity. WSJ
states that Arizona State University finance professor Anthony Sanders
recommends leaving Fannie
Mae and Freddie Mac intact but subjecting them to better regulation
and requiring them to hold
more capital. Mr. Sanders also suggested preventing Freddie Mac and
Fannie Mae from holding
large amounts of mortgages and related securities so that the two
companies would focus on
creating and guaranteeing mortgage securities that would be held by others.
About Freddie Mac
The Federal Home Loan Mortgage Corporation -- (FHLMC) NYSE: FRE --
commonly known as
Freddie Mac, is a stockholder-owned government-sponsored enterprise
authorized to make loans
and loan guarantees. Freddie Mac was created in 1970 to provide a
continuous and low cost source
of credit to finance America's housing.
Freddie Mac conducts its business primarily by buying mortgages
from lenders, packaging the mortgages into securities and selling
the securities -- guaranteed by Freddie Mac -- to investors.
Mortgage lenders use the proceeds from selling loans to Freddie
Mac to fund new mortgages, constantly replenishing the pool of
funds available for lending to homebuyers and apartment owners.
At Sept. 30, 2008, the company's balance sheet showed total assets of
$804,390 billion and total
liabilities of
$818,185 billion, resulting in a stockholders' deficit of
$13,795 billion.
Conservatorship
As reported by the Troubled Company Reporter, the U.S. government
took direct responsibility for Fannie Mae and Freddie Mac, placing the
government sponsored
enterprises under conservatorship on September 7, 2008. James B.
Lockhart, director of Federal
Housing Finance Agency, said that Fannie Mae and Freddie Mac share the
critical mission of
providing stability and liquidity to the housing market. Between
them, the Enterprises have $5.4
trillion of guaranteed mortgage-backed securities (MBS) and debt
outstanding, which is equal to
the publicly held debt of the United States. Among the key components
of the conservatorship, the
FHFA, as conservator, assumed the power of the Board and management.
FORUM HEALTH: Files for Chapter 11 Bankruptcy in Ohio
-----------------------------------------------------
Forum Health and 17 of its affiliates made a voluntary filing
under Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the Northern District of Ohio. The case will
be heard by the Hon. Kay Woods.
Walter J. Pishkur, president and chief executive officer, said the
Company suffered about $22 million in operating losses including
$6 million in investment losses in 2008 and failed to comply with
certain financial covenants in its debt agreement as a result of
the economic condition. The Company borrowed $60 million to
invest in its business through a formal plan, which it executed
between 2002 and 2005, but the plan failed to produce the expected
positive results due to several economic challenges, Mr. Pishkur
said.
The Company, Mr. Pishkur added, retained Wellspring Partners to
assist management with turnaround initiatives in December 2005 and
Cain Brothers & Company LLC to evaluate strategic options
regarding the disposition of certain assets to raise revenue and
reduce the company's outstanding debt. These professionals have
been retained to address the causes of the defaults and obtain
forbearance agreements, he noted.
In 2006, the Company froze its defined benefit plan for all non-
union participants and revised the non-union 401(k) plan. The
company amended the healthcare program and converting vacation,
sick-time and personal days into a paid-time-off program, Mr.
Pishkur related.
In its statement announcing its Chapter 11 filing, the Company
said the system's day-to-day operations are expected to continue
as usual during the reorganization process -- including those at
Northside Medical Center in Youngstown, Trumbull Memorial
Hospital in Warren, Hillside Rehabilitation Hospital in Howland
and Austintown Medical Park in Austintown. Employees will be paid
for their work in the ordinary course of business before and after
the filing.
"Our goal is simple -- to create a financially strong health care
system to serve the diverse needs of the people of the Mahoning
Valley and beyond," said Walter Pishkur, who became president and
chief executive officer on October 15, 2008. "This action gives
us the opportunity to continue to execute on the revitalization
strategy that will impact the future of a system that provides
thousands of jobs, generates millions of dollars in local tax
revenues and delivers outstanding clinical outcomes to the
community. Forum Health ensures a vibrant local medical community
and choice for the people of the Valley, and helps to contain
health care costs for everyone."
The system's strategic plan, already in place, focuses on
increasing admissions, improving patient satisfaction, enhancing
physician relations, re-establishing a formal presence in Boardman
to serve southern Mahoning County; and implementing cost-savings
initiatives.
The Forum Health system employs nearly 4,000 people and is the
second-largest provider of jobs in the Mahoning Valley. The
system's payroll is close to $170 million and pumps more than
$55 million of tax money into local, state and federal governments
every year. Patient volume at Northside and Trumbull Memorial
totaled more than 329,000 in 2008, and the system has set a goal
of increasing admissions by an additional 10 patients per day.
"Our valued employees have consistently risen to the occasion
during a very difficult period for this organization," said Mr.
Pishkur. "And through it all, we have consistently earned
nationally recognized quality awards for clinical excellence,
cardiac services and critical care, as well as numerous Five-Star
ratings in specific specialty areas, including orthopedics."
Coming amidst the current economic recession, the filing is a
decisive and proactive step in the ongoing effort to drive the
system forward toward long-term success and financial vitality.
Over the past four years, that effort has been marked by four
distinct phases -- an evaluation of the system by strategic health
care consultants, the sale of certain assets, the retention of
local management and the implementation of a financial
restructuring plan.
During that time, Forum Health met its payroll, vendor and bond
payment obligations, and enhanced clinical outcomes. Operating
costs have been reduced by more than $65 million since 2005, while
total debt has been reduced from $176 million in 2006 to
approximately $84 million, including a $55 million debt service
reserve fund.
In late February 2009, the business plan instituted an additional
cost-savings plan aimed at narrowing the gap between revenues and
expenses. The plan, which maintained current pay levels and
preserved every currently filled job, included changes in the
401(k) savings plan, defined contribution pension plan and
employee health care premiums for non-union employees.
Management expects to continue to work with labor unions
representing Forum Health employees to achieve corresponding cost-
savings initiatives.
"Even with the continued support and cooperation of our employees,
it quickly became clear that -- due to the prolonged local
economic downturn, compounded by national economic problems -- we
could no longer ensure continued economic viability without a
Chapter 11 filing," said Mr. Pishkur. "Now, through the
bankruptcy process, we have the opportunity to restructure,
regroup and re-energize our entire organization."
Forum Health's history dates back to 1881 with the founding of the
Youngstown Hospital Association. The association established
Youngstown's first hospital in 1883 and eventually opened
Northside Medical Center in 1929, setting a benchmark as one of
the first multi-unit hospitals in the nation. The system evolved
into Forum Health in 1997 when Northside Medical Center and the
former Tod Children's Hospital merged with Trumbull Memorial
Hospital.
The Company listed assets and debt between $100 million and
$500 million each. The company owed $1.3 million to Siemens
Healthcare Diagnostics Inc.; $962,031 to Owens Minor; and $407,430
to Zimmer US Inc.
The Company proposed McDonald Hopkins LLC its counsel; Nadler
Nadler & Burdman Co. LPA as co-counsel; Kurtzman Carson
Consultants LLC as claims noticing and balloting agent; and
Huron Consulting Services LLC as financial advisors.
Headquartered in Warren, Ohio, Forum Health --
http://www.forumhealth.org-- offers health care services. The
company primary service area consists of the northeast Ohio
counties of Mahoning, Trumbull and Columbiana; and northeast Ohio
counties of Ashtabula, Geauga and Portage and the
Pennsylvania counties of Mercer and Lawrence.
FORUM HEALTH: Wants Access to Secured Lenders Cash Collateral
-------------------------------------------------------------
Forum Health and its debtor-affiliates ask the U.S. Bankruptcy
Court for the Northern District of Ohio for authority to:
a) utilize cash collateral securing repayment of secured loans
from Master Trustee, the Bond Trustees and the Prepetition
Secured Creditors;
b) provide adequate protection; and
c) schedule a final hearing.
In connection with four separate public bond issues, pursuant to
which the Debtors raised over $194.2 million, the Debtors entered
into various prepetition financing agreements including the
Bond Indentures, the Base Lease, the Lease Agreement, the Master
Trust Indenture, the Mortgages, the Policies, the Insurance
Agreement, the Standby Agreement, the Reimbursement Agreement and
the WCLC Reimbursement Agreement. To date, approximately
$139.2 million in gross aggregate principal amount of the Bonds
remains outstanding under the Bond Indentures.
All of the prepetition obligations are secured by first priority
liens and security interests on certain assets and property of the
Debtors.
The Debtors have pledged, assigned and granted to the Master
Trustee an assignment of and security interest in substantially
all of the assets of the Debtors. As of the petition date, the
Debtors were and continue to be, under the Prepetition Financing
Agreements, jointly and severally indebted and liable to the
Prepetition Secured Creditors in the gross aggregate principal
amount of not less than $139.2 million; and the Debtors are in
default of their debts and obligations under the Prepetition
Financing Agreements.
The Debtors will use the cash collateral to operate their
businesses, to continue to provide patient care and to develop
their plans of reorganization.
The Debtors propose to provide adequate protection by:
a) granting the lenders additional and replacement continuing,
valid, binding, enforceable, non-avoidable and automatically
and properly perfect security interests in and liens;
b) providing valid, binding, enforceable, non-avoidable and
automatically and properly perfected security interests in
and liens on all presently owned and hereafter acquired
assets of the Non-Obligated Group Debtors to compensate the
lenders for any diminution in their Prepetition Collateral;
c) consenting to the allowance of a superpriority claim for the
benefit of the lenders;
d) paying as applicable, adequate protection payments: (i) in
an amount equal to the amount of interest that would
otherwise be payable under the applicable prepetition
financing agreements and paid on the same schedule as
interest would be paid as and when due under the applicable
prepetition financing agreement; and (ii) in the amount of
all reasonable fees, charges and expenses in accordance with
the prepetition financing agreements;
e) employing Dalton Edgecomb of Huron Consulting Group as chief
restructuring officer.
f) establishing an indemnity account, into which, upon the
earlier of: (i) the first occurrence of an Event of Default
or (2) the closing of any sale transaction for any of the
Debtors' assets the net proceeds of any sales up to an
amount of $500,000 will be deposited as security for any
reimbursement, indemnification or similar continuing
obligations of the Debtors in favor of the lenders under the
prepetition financing agreements.
A full-text copy of the cash collateral budget is available for
free at:
http://bankrupt.com/misc/cashcollbudget.pdf
About Forum Health
Based in Warren, Ohio, Forum Health -- http://www.forumhealth.org/
-- offer health care services. The primary service area consists
of the northeast Ohio counties of Mahoning, Trumbull and
Columbiana; and northeast Ohio counties of Ashtabula, Geauga and
Portage and the Pennsylvania counties of Mercer and Lawrence.
The Debtor and its debtor-affiliates filed for Chapter 11
protection on March 16, 2009, (Bankr. N.D. Ohio Lead Case No.: 09-
40795) Paul W. Linehan, Esq. and Shawn M Riley, Esq. at
McDonald Hopkins LLC represents the Debtors in heir resructuring
efforts. The Debtors propose to employ Michael A. Gallo, Esq. at
Nadler Nadler & Burdman Co., LPA as co-counsel; Kurtzman Carson
Consultants LLC as claims, noticing and balloting agent; and Huron
Consulting Services LLC as financial advisors. The Debtors listed
estimated assets of $100 million to $500 million and estimated
debts of $100 million to $500 million.
FRANK & CAMILLE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Frank & Camille's Keyboard Center of Huntington, Inc.
482 Route 110
Melville, NY 11747
Bankruptcy Case No.: 09-71505
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Frank & Camille's Keyboard Center of Valley
South Grossman 09-71518
Frank & Camille's Keyboard Center of Westbury 09-71522
The Piano Warehouse Factory Outlet, Inc.,
Eisenberg 09-71524
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Eastern District of New York (Central Islip)
Judge: Dorothy Eisenberg
Debtor's Counsel: Fred S. Kantrow, Esq.
The Law Offices of Avrum J. Rosen, PLLC
38 New Street
Huntington, NY 11743
Tel: (631) 423-8527
Fax : (631) 423-4536
Email: fkantrow@avrumrosenlaw.com
Total Assets: $951,367
Total Debts: $3,391,045
The Debtor does not have any creditors who are not insiders.
The petition was signed by Camille Scheidemann, president of the
Company.
FREEDOM VENTURES: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Freedom Ventures I, LLC
617 E. Third Avenue
Columbus, OH 43201
Bankruptcy Case No.: 09-52149
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Southern District of Ohio (Columbus)
Debtor's Counsel: Robert E. Bardwell, Esq.
995 South High Street
Columbus, OH 43206
Tel: (614) 445-6757
Fax: (614) 224-4870
Email: rbardwell@ohiobankruptlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $500,001 to $1,000,000
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Erik Bertelsen Promissory note $8,500
Marguerite Bertelsen
18 Butterfield Lane
Powell, OH 43065
Loveland & Brosius Attorney's fees $5,000
50 W. Broad Street
Columbus, OH 43215
The petition was signed by Richard W. Mann, Jr., Managing Member
of the company.
FREEPORT-MCMORAN COPPER: Fitch Affirms 'BB' Preferred Stock Rating
------------------------------------------------------------------
Fitch Ratings has affirmed the Issuer Default Rating and debt
ratings of Freeport-McMoRan Copper & Gold Inc. and its subsidiary
Phelps Dodge Corporation:
FCX
-- IDR at 'BBB-';
-- $1 billion secured bank revolver at 'BBB-';
-- 6.875% secured notes due 2014 at 'BBB-';
-- $500 million PT Freeport Indonesia/FCX secured bank revolver
at 'BBB-';
-- Unsecured notes due 2015 and 2017 at 'BBB-';
-- 7% convertible notes due 2011 at 'BBB-'; and
-- Convertible preferred stock at 'BB'.
PD
-- 8.75% senior unsecured notes due 2011 at 'BBB-';
-- 7.125% senior unsecured debentures due 2027 at 'BBB-';
-- 9.50% senior unsecured notes due 2031 at 'BBB-'; and
-- 6.125% senior unsecured notes due 2034 at 'BBB-'.
The Rating Outlook is Stable.
At year-end, total debt of $7.4 billion was 1.08 times (x) 2008
operating EBITDA of $6.8 billion. Earnings in 2009 will fall given
the fall in copper prices from July peaks of about $4.00/lb. to
about $1.50/lb. recently. Fitch expects leverage to increase to
about 2.75x with full year copper prices at $1.50/lb. FCX has
raised equity, cut its dividend, curtailed production and cut
capital spending to protect liquidity while preserving resources
and growth opportunities. Fitch expects revolver borrowings to be
modest during this period. A review of the ratings and Outlook
would be warranted should copper prices move substantially below
$1.50/lb.
Fitch notes that earnings and cash flows are highly leveraged to
metals prices and a $0.10/lb. decline in copper prices could cut
EBITDA by $375 million over a 12-month period. In particular, FCX
realized $2.69/lb. of copper in 2008. FCX estimates operating
cash flows to be about $1 billion in 2009, which is net of an
estimated $0.6 billion for working capital requirements, assuming
price of $1.50/lb. for copper, $800/oz. for gold and $9/lb. for
molybdenum. Each $0.10/lb. change in copper could impact this
estimate by approximately $260 million.
The ratings reflect FCX's position as the world's second largest
copper producer, its diversified operations and strong liquidity
as well as the company's exposure to copper prices.
GENERAL MOTORS: CEO Changes Stance on Firm's Possible Bankruptcy
----------------------------------------------------------------
John D. Stoll and Neal E. Boudette at The Wall Street Journal
report that General Motors Corp. CEO Rick Wagoner has changed his
view on the Company's possible bankruptcy, saying that the Company
could emerge from a Chapter 11 filing.
According to WSJ, Mr. Wagoner has been adamant on a Chapter 11
filing by GM. WSJ relates that GM is in negotiations with the
United Auto Workers union over labor cost cuts and with
bondholders over cutting the Company's debt. WSJ note that
signaling that GM no longer considers bankruptcy as off the table
could strengthen the Company's hand in those talks.
Mr. Wagoner, WSJ relates, told reporters that he still believes
that "99%" of GM's problems can be solved without filing for
bankruptcy protection, and that clients would avoid buying cars
from a bankrupt automaker. Bankruptcy would be expensive, and the
U.S. government would have to provide debtor-in-possession
financing, WSJ says, citing Mr. Wagoner. According to the report,
Mr. Wagoner said that a bankruptcy filing "puts things out of the
control of the board and management." Mr. Wagoner said that
bankruptcy "could work but it might not work," the report states.
The auto task force said on Monday that they are focused on
restructuring GM and Chrysler LLC outside of bankruptcy court, WSJ
reports. Mr. Wagoner, according to WSJ, was in Washington for
talks with the task force chiefs Steven Rattner and Ron Bloom.
WSJ states that the task force will decide by March 31 whether the
U.S. Treasury should give GM and Chrysler more financial
assistance. The report says that GM has already received about
$13.4 billion in loans and has asked for up to $16.6 billion more,
while Chrysler has secured $4 billion in loans and has asked for
an additional $5 billion.
According to WSJ, the task force's decision will influence whether
GM gets help from other countries. German Economics Minister
Karl-Theodor zu Guttenberg said on Tuesday that his country won't
decide on whether to financially assist GM until the Company works
out its restructuring plans with the U.S. government, WSJ relates.
The German government isn't willing to take a stake in Opel but is
open to guaranteeing loans for a private investor, WSJ states,
citing Minister zu Guttenberg. The report says that the German
government has been frustrated that GM hasn't provided a detailed
plan for Opel.
GM hopes that the economy will rebound in 2010, allowing the
Company to start repaying the $13.4 billion U.S. loan it received
from the U.S. government in December 2008, WSJ relates, citing Mr.
Wagoner. GM will still need billions more in government funding,
WSJ states.
New Bill Aimed at Stimulating Auto Sales
Josh Mitchell at Dow Jones Newswires reports that several U.S.
lawmakers are renewing a push to provide federal vouchers to
consumers who replace older vehicles with new, fuel-efficient
cars, hoping that the recent success of a program in Germany will
give the proposal new momentum. According to Dow Jones, Rep.
Betty Sutton introduced a bill on Tuesday authorizing a "cash for
clunkers" program, designed to stimulate auto sales while reducing
car pollution. Dow Jones relates that supporters of the bill
failed to get the program included in the recently enacted
economic stimulus program. WSJ states that auto industry
officials have called for that program to stimulate auto sales. A
"cash for clunkers" program, subsidized by the government, could
help spur demand, WSJ says, citing Mr. Wagoner.
According to Dow Jones, the new bill would provide vouchers equal
to $3,000 to $5,000 to consumers who trade in vehicles built at
least eight years ago, depending on the "fuel economy" of the car
being purchased. The vouchers, says Dow Jones, would be limited
to purchases of cars with a fuel economy of at least 27 miles per
gallon on highways. The standard for trucks would be 24 mpg, WSJ
states. According to the report, consumers could opt to use the
vouchers toward mass-transit use.
Annual Stockholders' Meeting on August 4
GM's Board of Directors today announced that the company's annual
stockholders' meeting will be held on August 4, 2009, in Detroit.
The deadline for submitting stockholder proposals will be
March 31, 2009, and the deadline for submitting stockholder board
nominations is April 6, 2009. GM disclosed its 2008 executive
compensation in its annual report on Form 10-K, filed on March 5.
Stockholders of record as of June 12, 2009, are eligible to vote
at the annual meeting; proxy materials will be mailed in June.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units. GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela. GM LAAM markets vehicles under the Buick,
Cadillac, Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and
Suzuki brands.
GM's common stock was considered the stock market's bellwether for
many years, hence the saying "What's good for GM is good for
America."
As reported in the Troubled Company Reporter on Nov. 10, 2008,
General Motors Corporation's balance sheet at Sept. 30, 2008,
showed total assets of US$110.425 billion, total liabilities of
$170.3 billion, resulting in a stockholders' deficit of
$59.9 billion.
* * *
As reported in the Troubled Company Reporter on Nov. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on General Motors Corp. To 'CCC+'
from 'B-' and removed them from CreditWatch, where they had been
placed with negative implications on Oct. 9, 2008. S&P said that
the outlook is negative.
Fitch Ratings, as reported in the Troubled Company Reporter on
Nov. 11, 2008, placed the Issuer Default Rating of General Motors
on Rating Watch Negative as a result of the Company's rapidly
diminishing liquidity position. Given the current liquidity level
of US$16.2 billion and the pace of negative cash flows, Fitch
expects that GM will require direct federal assistance over the
next quarter and the forbearance of trade creditors in order to
avoid default. With virtually no further access to external
capital and little potential for material asset sales, cash
holdings are expected to shortly reach minimum required operating
levels. Fitch placed these on Rating Watch Negative:
-- Senior secured at 'B/RR1';
-- Senior unsecured at 'CCC-/RR5'.
As reported in the Troubled Company Reporter on June 24, 2008,
DBRS has placed the ratings of General Motors Corp. And General
Motors of Canada Limited Under Review with Negative Implications.
The rating action reflects the structural deterioration of the
company's operations in North America brought on by high oil
prices and a slowing U.S. Economy.
GENERAL MOTORS: Complete Separation of Opel From Firm Impossible
----------------------------------------------------------------
Christoph Rauwald at The Wall Street Journal reports that a
document compiled for the German lower house of Parliament's
economic and technology committee said that complete separation of
Opel from General Motors Co. is impossible.
According to WSJ, the document said, "One can try to create a
certain degree of security for German creditors, citizens with
legal terms."
As reported by the Troubled Company Reporter on March 12, 2009,
German Chancellor Angela Merkel said that in order to grant any
aid, it is necessary to know plans for GM, how independently Opel
will be allowed to operate and the future of Opel's patents.
WSJ relates that GM's European division is seeking EUR3.3 billion
in aid from Germany and other governments in the region to avert
insolvency. According to the report, the ministry asked a law
firm to examine how to make sure that any state help for Opel
doesn't end up at GM but remains in Germany.
Jeff Green at Bloomberg relates that GM favors a plan to sell at
least half of Opel to an investor with European government
backing, close plants and cut $1.2 billion from costs.
Opel said in a restructuring plan submitted to the government
earlier this month that GM's financial support would come in the
form of capital contributions from other European GM units and
cash for severance packages, WSJ reports.
Bondholders Willing to Help GM Avert Bankruptcy
Dow Jones Newswires reports that a group representing GM bond
holders said that it has been willing to cut a deal with the
Company that would help avoid a bankruptcy.
Steven Rattner, a lead advisor of the auto task force, has
described the committee a being "quite difficult," and said that
the bondholders were obstructing GM's recovery, Dow Jones relates.
Dow Jones states that bondholders claimed that they're being asked
to sacrifice more than the United Auto Workers, which is in talks
with GM over reducing the Company's obligations to retirees.
The group said in a statement that it presented a proposal several
weeks ago for a debt swap which fell in line with terms set by the
U.S. government when it loaned GM about $13.4 billion to stay
afloat. The committee said in a statement that the the proposal
presented by the bondholders "provides the best chance, given the
parameters set forth in the plan, of completing an out-of-court
restructuring by securing a high level of acceptance among a
diverse group of GM bondholders -- from mutual funds to pension
funds to retail bondholders. We stand ready to do our part to
bring about a workable solution."
Citing GM Chief Financial Officer Ray Young, Bloomberg reports
that the Company still needs more than $28.5 billion in cuts from
a union retiree health fund and from unsecured bondholders by a
March 31 government deadline.
Mr. Young, Bloomberg relates, said that the Canadian Auto Workers
agreed to freeze pay and reduce pension increases so that labor
costs are lower than those of foreign automakers in the U.S. like
Toyota Motor Corp. The report, citing Toyota spokesperson Mike
Goss, states that Toyota's hourly U.S. labor rate is about $48.
The report quoted Mr. Young as saying, "It's very possible they
have a different set of demographics, a different set of costs, so
it's very possible our agreement doesn't work for them."
According to Bloomberg, Mr. Young said that GM also had a good
dialogue with European Union economy ministers as the Company
seeks for EUR3.3 billion in state aid for its Opel division.
Bloomberg quoted Senator Bob Corker as saying, "It's very obvious
to me they're following the playbook that we laid out." Senator
Corker unsuccessfully argued in December for such changes as part
of a failed Congressional rescue, Bloomberg states. According to
the report, Senator Corker said that had the UAW agreed in
December to make the kinds of changes they are now making, an aid
package "would have overwhelmingly received bipartisan support"
rather than fail in the Senate.
GM spokesperson Dan Flores said that the Company informed a few
hundred secondary suppliers to its 3,000 primary suppliers that
the Company is willing to purchase parts directly if there are
concerns about the health of the primary provider, Bloomberg
reports.
About General Motors
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units. GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela. GM LAAM markets vehicles under the Buick, Cadillac,
Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands.
GM's common stock was considered the stock market's bellwether for
many years, hence the saying "What's good for GM is good for
America."
* * *
As reported in the Troubled Company Reporter on Nov. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on General Motors Corp. To 'CCC+'
from 'B-' and removed them from CreditWatch, where they had been
placed with negative implications on Oct. 9, 2008. S&P said that
the outlook is negative.
Fitch Ratings, as reported in the Troubled Company Reporter on
Nov. 11, 2008, placed the Issuer Default Rating of General Motors
on Rating Watch Negative as a result of the Company's rapidly
diminishing liquidity position. Given the current liquidity level
of US$16.2 billion and the pace of negative cash flows, Fitch
expects that GM will require direct federal assistance over the
next quarter and the forbearance of trade creditors in order to
avoid default. With virtually no further access to external
capital and little potential for material asset sales, cash
holdings are expected to shortly reach minimum required operating
levels. Fitch placed these on Rating Watch Negative:
-- Senior secured at 'B/RR1';
-- Senior unsecured at 'CCC-/RR5'.
As reported in the Troubled Company Reporter on June 24, 2008,
DBRS has placed the ratings of General Motors Corp. And General
Motors of Canada Limited Under Review with Negative Implications.
The rating action reflects the structural deterioration of the
company's operations in North America brought on by high oil
prices and a slowing U.S. Economy.
GENERAL MOTORS: Will Temporarily Shut Midsize-Car Plant
-------------------------------------------------------
The Associated Press reports that General Motors Corp.
spokesperson Chris Lee said that the Company will temporarily
close Orion Township plant for three weeks due to lower demand for
its products.
According to The AP, the Orion Township plant is a midsize-car
factory near Pontiac that makes the Pontiac G6 and Chevrolet
Malibu. Citing Mr. Lee, The AP relates that the plant will close
in the weeks of March 30, April 6, and April 13 to "align
production with market demand."
Mr. Lee said that the shutdown is only implemented in the Orion
plant's products and is not part of a larger company production
cut, The AP states.
Alan Harman at WardsAuto.com relates that GM said, "Contrary to
popular misconceptions, GM Thailand and Chevrolet Sales Thailand
are not on the brink of bankruptcy and have no intent to file
bankruptcy."
Headquartered in Detroit, Michigan, General Motors Corp. (NYSE:
GM) -- http://www.gm.com/-- was founded in 1908. GM employs
about 266,000 people around the world and manufactures cars and
trucks in 35 countries. In 2007, nearly 9.37 million GM cars and
trucks were sold globally under the following brands: Buick,
Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel,
Pontiac, Saab, Saturn, Vauxhall and Wuling. GM's OnStar
subsidiary is the industry leader in vehicle safety, security and
information services.
General Motors Latin America, Africa and Middle East, with
headquarters in Miramar, Florida, is one of GM's four regional
business units. GM LAAM employs approximately 37,000 people in
18 countries and has manufacturing facilities in Argentina,
Brazil, Colombia, Ecuador, Egypt, Kenya, South Africa and
Venezuela. GM LAAM markets vehicles under the Buick, Cadillac,
Chevrolet, GMC, Hummer, Isuzu, Opel, Saab and Suzuki brands.
GM's common stock was considered the stock market's bellwether for
many years, hence the saying "What's good for GM is good for
America."
* * *
As reported in the Troubled Company Reporter on Nov. 11, 2008,
Standard & Poor's Ratings Services lowered its ratings, including
the corporate credit rating, on General Motors Corp. To 'CCC+'
from 'B-' and removed them from CreditWatch, where they had been
placed with negative implications on Oct. 9, 2008. S&P said that
the outlook is negative.
Fitch Ratings, as reported in the Troubled Company Reporter on
Nov. 11, 2008, placed the Issuer Default Rating of General Motors
on Rating Watch Negative as a result of the Company's rapidly
diminishing liquidity position. Given the current liquidity level
of US$16.2 billion and the pace of negative cash flows, Fitch
expects that GM will require direct federal assistance over the
next quarter and the forbearance of trade creditors in order to
avoid default. With virtually no further access to external
capital and little potential for material asset sales, cash
holdings are expected to shortly reach minimum required operating
levels. Fitch placed these on Rating Watch Negative:
-- Senior secured at 'B/RR1';
-- Senior unsecured at 'CCC-/RR5'.
As reported in the Troubled Company Reporter on June 24, 2008,
DBRS has placed the ratings of General Motors Corp. And General
Motors of Canada Limited Under Review with Negative Implications.
The rating action reflects the structural deterioration of the
company's operations in North America brought on by high oil
prices and a slowing U.S. Economy.
GENTA INC: To Pay Note Holders in Kind in Lieu of Cash
------------------------------------------------------
Genta Incorporated entered into a Purchase Agreement and Note
Amendment on February 17, 2009, with certain purchasers in order
to:
(A) amend the securities purchase agreement, dated June 5,
2008, among the Company and the purchasers to:
(i) remove the option of the purchasers to complete the
second closing of $20 million; and
(ii) permit the Company to raise additional capital
through a sale of up to $23,000,000 of equity or
debt securities pursuant to Registration Statement
No. 333-153278 provided that the offering is
approved by the holders of two-thirds of the
outstanding principal amount of the notes issued in
the June 2008 financing; and
(B) amend the Notes to:
(i) limit the purchasers ability to convert the notes
following a Follow-On Offering to their pro rata
share of authorized and outstanding shares of
common stock,
(ii) reduce the requirement for reserving shares of
common stock for conversion under the Notes from
125% to 100% during the three month period
following a Follow-On Offering, if any, and
(iii) revise the definition of permitted liens such that
it would include any security interest granted in
connection with any equity or debt financing
approved by the holder of two-thirds of the
outstanding principal amount of the Notes.
Genta said the amendments to the Purchase Agreement became
immediately effective upon receipt by the Company of approval from
holder of at least two-thirds of the outstanding principal amount
of the Notes. The amendments to the Notes became immediately
effective upon receipt by the Company of approval from all holders
of the outstanding principal amount of the Notes, which occurred
March 11, 2009.
In addition, on March 9, 2009, the Company entered into a Note
Amendment with the purchasers in order to permit the Company to
issue to each holder a note with the same terms and conditions as
the notes issued in its June 2008 financing for the March 9, 2009
interest payment equal to the aggregate amount of interest accrued
on such interest payment date in lieu of a payment of interest in
cash or interest shares.
The note purchasers are:
Name Note #
---- ------
Arcus Ventures Fund 1
667-2 (Baker) 2
667-1 (Baker) 3
14159, L.P. (Baker) 4
Baker Brothers Life Sciences, L.P. 5
Boxer Capital, LLC 6
Cat Trail Private Equity Fund, LLC 9
Loretta Itri 16
Radcliffe SPC, Ltd. 20
Raymond P. Warrell, Jr. 21
Raymond P. Warrell, Jr. 26
Rockmore Investment Master Fund Ltd. 22
Rodman & Renshaw LLC 23
Tang Capital Partners, LP 25
About Genta
Based in Berkeley Heights, New Jersey, Genta Incorporated is a
biopharmaceutical company engaged in pharmaceutical (drug)
research and development, its sole reportable segment. The
company is dedicated to the identification, development and
commercialization of novel drugs for the treatment of cancer and
related diseases.
* * *
From inception to December 31, 2008, Genta has incurred a
cumulative net deficit of $944.1 million. Genta said its
recurring losses from operations and negative cash flows from
operations raise substantial doubt about its ability to continue
as a going concern.
At December 31, 2008, Genta had $12.6 million in total assets,
$11.2 million in current liabilities and $6.33 million in total
long-term liabilities, resulting in $4.8 million in stockholders'
deficit. The company had $505.8 million in net loss in 2008.
GEORGE MELC: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: George MELC
Jane MELC
859-34th Avenue
San Francisco, CA 94121
Bankruptcy Case No.: 09-30543
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Northern District of California (San Francisco)
Debtor's Counsel: Robert T. Kawamoto, Esq.
Law Offices of Robert T. Kawamoto
234 Van Ness Ave.
San Francisco, CA 94102-3623
(415) 487-9790
Email: Kawlaw@aol.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/canb09-30543.pdf
The petition was signed by George MELC and Jane MELC.
GOLD COUNTRY: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Gold Country Homes LLC
P.O. Box 2507
Los Banos, CA 93635
Bankruptcy Case No.: 09-11779
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
Eastern District of California (Fresno)
Judge: Whitney Rimel
Debtor's Counsel: Justin D. Harris, Esq.
1690 W. Shaw Ave., #200
Fresno, CA 93711
Tel: (559) 439-4000
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/caeb09-11779.pdf
The petition was signed by Martha Sanchez, Managing Member of the
Company.
GOLDEN CENTURY: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Golden Century Real Estate Development, LLC
5525 S. Valley View Blvd., Suite 9
Las Vegas, NV 89118
Bankruptcy Case No.: 09-12936
Type of Business: The company is single asset real estate debtor.
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Linda B. Riegle
Debtor's Counsel: Kent L. Ivey, Esq.
Law Offices of Kent L. Ivey
64 N. Pecos Road, Suite 800
Henderson, NV 89074
Tel: (702) 990-6447
Fax: (702) 990-6445
Email: iveynet@earthlink.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $0 to $50,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/nvb09-12936.pdf
The petition was signed by Henry Zhang, Operation Manager of the
Company.
GONZALO MARTINEZ: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: Gonzalo Martinez
Modestina Martinez
72 Draper St.
Dorchester, MA 02122
Bankruptcy Case No.: 09-11877
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
District of Massachusetts (Boston)
Judge: Joan N. Feeney
Debtor's Counsel: Leonard Ullian, Esq.
The Law Office Of Ullian & Associates
220 Forbes Road
Suite 106
Braintree, MA 02184
(781) 848-5980
Email: karen@ullianlaw.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor did not file a list of 20 largest unsecured creditors
together with its petition.
The petition was signed by Gonzalo Martinez and Modestina
Martinez.
GOODY'S LLC: Proposes Bonuses for Executives and Other Employees
----------------------------------------------------------------
Goody's LLC is asking the U.S. Bankruptcy Court for the District
of Delaware for authority to pay bonuses to executives and other
employees, Bloomberg's Bill Rochelle said.
According to the report, Goody's proposes to make five executives
eligible for a total of $291,000 in bonuses if thresholds are
achieved in maximizing asset recoveries and minimizing expenses.
In addition, another 19 non-executives would be eligible to
participate in a $200,000 bonus pool with no one receiving more
than $24,000. The non-executives, according to Bloomberg, would
receive their payments if they remain on the job until their
assignments are completed between late March and July.
The Bankruptcy Court will consider approval of the proposed
bonuses on March 30.
Bloomberg relates that the executives eligible for the program are
the chief financial officer, the inside general counsel, the vice
president for systems, the controller, and the vice president
for technology. The CFO, according to the motion, is also being
given a separate incentive bonus by Prentice Capital Management,
which bought the chain in January 2006 and kept all the stock in
the prior reorganization in exchange for the second- and third-
lien loans.
Goody's LLC, returned to Chapter 11 three months after
confirmation a reorganization plan. It has conducted going-out-
of-business sales for its stores.
Prior Settlement
As reported by the TCR on March 11, Goody's LLC and its
affiliates, which filed for Chapter 11 about three months after
their predecessor Goody's Family Clothing emerged from bankruptcy,
were authorized by the U.S. Bankruptcy Court for the District of
Delaware to settle with the creditors' representative from their
first bankruptcy case.
An ad hoc committee of trade creditors -- consisting of 11 trade
vendors -- sought dismissal of the Goody's II cases. The group
claimed that the liquidation of the Debtors' assets should occur
"outside of bankruptcy or under the jurisdiction of this Court in
Goody's I. Thereafter, the proceeds of such disposition should
appropriately be administered in furtherance of substantial
consummation of the Goody's I plan including, inter alia,
replenishment of the woefully deficient administrative claim
reserves and otherwise to satisfy the remaining obligations of the
Reorganized Debtors under the Goody's I plan."
The Goody's I Plan of Reorganization -- which provided for the
mechanism for paying allowed claims against Goody's Family -- was
confirmed by the Court on October 7, 2008, and declared effective
13 days later. The Goody's I Plan provided for (i) a reserve of
approximately $2 million for allowed administrative claims and
provided that such claims would be paid in full or as agreed to by
the claimant as the claims were allowed, (ii) general unsecured
creditors (Class 8 of the Goody's I Plan) receiving (i) $2 million
to fund a limited liability company's prosecution of certain
avoidance actions and other claims on their behalf and (ii) a $15
million note. The Goody's I Plan provided for the continuation of
the debtors' business under new corporate entities, Goody's LLC
and its affiliates.
Goody's II debt structure, in order of priority:
Debt Creditor Status
---- -------- -------
Revolver (roughly $550,000 GECC Revolver paid,
plus $15 million in LOCs cash
outstanding letters of collateralized
credit)
Term loan (roughly GB Merchant Paid
$11 million) Partners
Tranche C (at least Prentice
$20 million) (PGDYS Lending)
$15 million note for
benefit of Goody's I
Class 8 (general unsecured)
creditors
Tranche D (at least Prentice (PGDYS
$15 million) Lending)
In addition to the obligations, the Goody's II estates also are
subject to claims for administrative claims arising in
the Goody's II cases, unpaid administrative obligations from
Goody's I in the range of $10 million, and general unsecured
claims arising after the Effective Date.
Terms of Settlement with Trade Creditors
On January 21, 2009, the ad hoc committee announced that, subject
to documentation, it had reached agreement with the Goody's II
debtors, the Plan Administrator for Goody's I, Prentice Capital
Management, LP, PGDYS LLC and PGDYS Lending LLC and the Official
Committee of Unsecured Creditors in Goody's II. Goody's II has
filed a motion seeking approval of the Settlement.
According to the U.S. Trustee, the key terms of the Settlement
are:
a. Increase the Administrative Reserve Under Goody's I Plan:
The Prentice Entities have agreed to allow the Goody's II
Debtors to use their cash collateral to provide an
Additional $5 million to the Plan Administrator to satisfy
accrued and unpaid administrative obligations under the
Goody's I Plan. In addition, the Goody's II Debtors and the
Prentice Entities have agreed to transfer certain
Litigation Rights and Permitted Preference Actions (as
defined in the Goody's I Plan) to the Plan Administrator,
the proceeds of which will also be available to satisfy
accrued and unpaid administrative obligations under the
Goody's I Plan. The cash portion of the Administrative
Reserve Increase would be paid in full before the Prentice
Entities receive payment in full on account of their
Tranche C obligations.
b. Satisfy Obligation to Allowed Class 8 Claims Under Goody's
I Plan: The Goody's I Plan provided that a $15 million
instrument payable to Allowed Class 8 Claims (general
unsecured creditors) of the Goody's I case was entitled to
receive payment senior in priority to any payment made to
the secured Tranche D obligations to the PGDYS Lending,
except in the event of a subsequent liquidation or sale of
substantially all of the company's assets under Section 363
of the Bankruptcy Code. In this alternative liquidation
scenario, the Goody's I Plan requires that 1/3rd of
proceeds available after satisfaction of the Tranche C
obligations be paid to the Plan Administrator on account of
the Allowed Class 8 Claims under the Goody's I Plan and
2/3rds of the proceeds be paid to PGDYS Lending on account
of the Tranche D obligations, until such time as the
Tranche D obligations have been paid in full. The
Settlement follows the dictates of the Goody's I Plan, as
required by the Confirmation Order, and provides that after
satisfaction in full of the Tranche C obligations, 1/3rd of
the remaining proceeds available from the liquidation will
be paid to the Plan Administrator in further satisfaction
of Allowed Class 8 Claims and 2/3rd of the proceeds will be
paid to PGDYS Lending on account of their Tranche D
obligations.
c. Avoidance Actions in the Goody's II Case Will be
Transferred to the Goody's II Committee: During the
tumultuous period between the two bankruptcy cases, the
Reorganized Debtors quickly became unable to pay their
unsecured debts as they matured. In light of the capital
structure of the Goody's II Debtors, a meaningful
distribution to general unsecured creditors is unlikely.
The Parties have recognized that fact and agreed to
transfer sole and exclusive authority to pursue (or not
pursue) any and all causes of action pursuant to chapter 5
of the Bankruptcy Code to the Goody's II Committee, to
ensure that unsecured creditors who were not paid for goods
and services provided to the Reorganized Debtors -- despite
believing they were transacting with a company that had
just emerged from bankruptcy -- would not add insult to
injury by being sued for a preference in order to fund
administrative claims in the Goody's II cases.
d. Payment of Goody's II Administrative Claims: The Prentice
Entities will permit the Goody's II estates to use the
Prentice Entities' cash collateral to pay in full the
Allowed administrative expense claims in the Goody's II
case in accordance with, and subject to, the wind-down
budget attached to the Settlement as "Annex 1."
e. Provision of Funds to Enable Plan Administrator and Post
Effective Date Committee in Goody's I to Perform Goody's I
Plan Obligations: The Plan Administrator will be provided
up to $250,000, inclusive of the $100,000 advance provided
to the Plan Administrator on January 9, 2009, from the cash
collateral of Goody's II, along with the right to use 1/3rd
of the net proceeds from the Litigation Rights and
Permitted Preference Actions, in furtherance of performing
its fiduciary obligations under the Goody's I Plan.
Further, the Post Effective Date Committee will be provided
up to $15,000 to perform its oversight functions under the
Goody's I Plan.
f. Allowance of Prentice Claims in Goody's II Cases: All
obligations under the Tranche C exit facility ($20 million)
and Tranche D exit facility ($15 million) will deemed to
be allowed secured claims, plus all accrued interest, fees,
costs, expenses, and all other Obligations as defined in
the credit documents for all purposes in these Cases;
provided, however, that all parties' rights have been
reserved with respect to the determination, allowance, or
payment of any early termination fee under the Tranche C
and Tranche D exit facilities. Allowance of such claims
enables the Parties to effectuate the above-summarized
distribution of proceeds in a more equitable manner than
would have otherwise occurred absent litigation or
agreement between the Parties.
g. Prentice's Waiver of Rights in Goody's II Chapter 5
Actions: The Prentice Entities agree to waive any right or
claim to receive any proceeds from Avoidance Actions
arising from the filing of the Goody's II bankruptcy cases.
h. Establish Supplemental Administrative Claim Bar Date in
Goody's I Cases: To ensure that the Administrative Reserve
Increase will be equitably distributed amongst all
creditors in the Goody's I cases who hold an accrued and
unpaid administrative claim, the Plan Administrator will be
permitted to set a new administrative claim bar date of
________________, 2009, applicable to those entities with
claims for (i) goods and/or services provided after the
Petition Date (as defined in the Plan) but before the
Effective Date (as defined in the Plan) for which the
entity supplying such goods and/or services has not
received payment and (ii) unpaid cure costs associated with
any and all contracts assumed and assigned under the Plan.
i. Releases of the Prentice Entities and the Plan
Administrator: The Settlement provides for the waiver and
release of any and all claims against the Plan
Administrator and the Prentice Entities, arising out of, in
connection with, or related to the conduct of the business
of the Goody's I Debtors, the Goody's I cases, Reorganized
Debtors or the Goody's I Plan. To the extent permissible
by law, such releases would be applicable to the Goody's I
Debtors, Goody's II Debtors, Ad Hoc Committee, Committee
and all parties in interest receiving notice of the
Settlement and an opportunity to object.
j. Reimbursement of Fees and Expenses of Ad Hoc Committee: The
Goody's II Debtors and Prentice Entities have agreed to
support the allowance of an administrative claim pursuant
to Section 503(b) of the Bankruptcy Code for counsel and
local counsel to the Ad Hoc Committee in an amount equal to
the actual, reasonable fees and expenses incurred in
connection with (i) their participation in pre-petition
efforts to organize vendors of Goody's I and Goody's II in
an effort to reach a consensual out-of-court solution, (ii)
their participation in the pre-petition sale process,
including the auction of substantially all of the Debtors'
assets and (iii) filing, litigating, prosecuting,
negotiating and settling the Motion to Dismiss.
About Goody's LLC
Headquartered in Wilmington, Delaware, Goody's LLC, successor to
Goody's Family Clothing Inc., operates a chain of clothing stores.
Goody's LLC and 13 of its affiliates filed for Chapter 11
protection on January 13, 2009 (Bankr. D. Del. Lead Case No. 09-
10124). Young, Conaway, Stargatt & Taylor, LLP, and Bass Berry &
Sims PLC represent the Debtors as counsel. Skadden, Arps, Slate
Meagher & Flom, LLP is the Debtors' special counsel; FTI
Consulting Inc. is the Debtors' financial advisor.
Goody's Family Clothing Inc., as of May 31, 2008, operated 355
stores in several states with approximately 9,868 personnel of
which 170 employees are covered under a collective bargaining
agreement. Goody's Family and 19 of its affiliates filed for
Chapter 11 protection on June 9, 2008 (Bankr. D. Del. Lead Case
No. 08-11133). Gregg M. Galardi, Esq., and Marion M. Quirk, Esq.,
at Skadden Arps Slate Meagher & Flom LLP, and Paul G. Jennings,
Esq., at Bass, Berry & Sims PLC, represented the Debtors. The
Company emerged from bankruptcy Oct. 20, 2008, after closing more
than 70 stores. The reorganized entity was named Goody's LLC.
GOTTSCHALKS INC: Liquidators JV is Lead Bidder; Auction March 30
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware has set an
April 1, 2009 hearing to confirm the results of the auction and
approve the sale of substantially all of Gottschalks Inc.'s assets
to the prevailing bidders at the auction.
The auction will be held at the offices of Richards, Layton &
Finger, P.A., 920 N. King Street, Wilmington, Delaware 1980, on
March 30, at 10:00 a.m. (EDT).
Objections to the sale motion that are specific to any individual
bidders will be filed and served no later than 5:00 p.m. (EDT) on
March 31.
As reported in the Troubled Company Reporter on March 16, 2009,
Gottschalks said that it had appointed a joint venture comprised
of liquidators SB Capital Group LLC, Tiger Capital Group LLC,
Great American Group LLC, and Hudson Capital Partners LLC as a
"stalking horse" bidder.
On March 4, 2009, the Court approved the sales procedures for a
going concern of all or substantially all of the Debtor's assets
and/or a full chain liquidation sale of the Debtor's inventory and
equipment.
About Gottschalks Inc.
Headquartered in Fresno, California, Gottschalks Inc. (Pink
Sheets: GOTTQ.PK) -- http://www.gottschalks.com-- is a regional
department store chain, operating 58 department stores and three
specialty apparel stores in six western states. Gottschalks
offers better to moderate brand-name fashion apparel, cosmetics,
shoes, accessories and home merchandise.
The xompany filed for Chapter 11 protection on January 14, 2009
(Bankr. D. Del. Case No. 09-10157). O'Melveny & Myers LLP
represents the Debtor in its Chapter 11 case. Lee E. Kaufman,
Esq., and Mark D. Collins, Esq., at Richards, Layton & Finger,
P.A., will serve as the Debtors' co-counsel. The Debtor selected
Kurtzman Carson Consultants LLC as its claims agent. The U.S.
Trustee for Region 3 appointed seven creditors to serve on an
Official Committee of Unsecured Creditors. When the Debtor filed
for protection from its creditors, it listed $288,438,000 in total
assets and $197,072,000 in total debts as of January 3, 2009.
HARRAH'S ENTERTAINMENT: Owners May Retain Control After Bankruptcy
------------------------------------------------------------------
Apollo Management LP and TPG Inc., which own Harrah's
Entertainment Inc., may be able to retain control of the Company
even following a bankruptcy filing. Apollo and TPG had purchased
Harrah's in January 2008 in a $27.2 billion transaction.
A firm filing for Chapter 11 may seek to restructure its balance
sheet by paying off claims and interests pursuant to a Chapter 11
plan. Under the absolute priority rule of the Bankruptcy Code,
however, secured creditors have priority over a company's
unsecured creditors to the extent of the value of their
collateral. Unsecured creditors, on the other hand, stand ahead
of investors in the receiving line and their claims must be
satisfied before any investment loss is compensated. When there
is not enough to pay claims, investors will be "out-of the-money",
and will not receive any recovery for their interests.
However, according to Bloomberg's Bill Rochelle, Apollo and TPG
may retain control by virtue of debt they purchased and the most
recent tender offer.
According to Onlinecasinoadvisory.com, TPG and Apollo are ensuring
their position in the event that Harrah's Entertainment defaults
on payments and file for bankruptcy protection.
Onlinecasinoadvisory.com states that TPG and Apollo will still be
able to control Harrah's Entertainment if bankruptcy occurs, by
buying up existing debt. The report says that the loans being
bought would be converted into company equity in a bankruptcy
procedure.
Onlinecasinoadvisory.com relates that Harrah's Entertainment
reported $5.35 billion loss for the fourth quarter 2008.
Onlinecasinoadvisory.com states that much of the debt was created
in the process of taking Harrah's Entertainment private.
According to the report, rapidly declining revenues haven't been
enough to meet the obligations.
About Harrah's Entertainment
Las Vegas, Nevada-based Harrah's Entertainment, Inc. --
http://www.harrahs.com-- operates nearly 40 casinos across the
United States, primarily under the Harrah's(R), Caesars(R) and
Horseshoe(R) brand names; Harrah's also owns the London Clubs
International family of casinos and the World Series of Poker(R).
Private equity firms Apollo Global Management and TPG Capital LP
acquired Harrah's in January for $31 billion.
At Sept. 30, 2008, the company's consolidated condensed balance
sheets showed total assets of $37.0 billion, total liabilities of
$33.4 billion and stockholders' equity of $3.6 billion.
For three months ended Sept. 30, 2008, the company reported net
loss of $129.7 million compared with net income of $244.4 million
for the same period in the previous year.
For nine months ended Sept. 30, 2008, the company posted net loss
of $100.9 million compared with net income of $667.2 million for
the same period in the previous year.
The company's cash and cash equivalents, including funds borrowed
during the quarter under its credit facilities, totaled
approximately $1.0 billion at Sept. 30, 2008, compared to
$654.7 million at Sept. 30, 2007.
* * *
As reported by the TCR on March 10, 2009, Standard & Poor's
Ratings Services lowered its corporate credit rating on Las Vegas-
based Harrah's Entertainment Inc. and its wholly owned subsidiary,
Harrah's Operating Co. Inc., to 'CC' from 'CCC'. The rating
outlook is negative. At the same time, S&P lowered the issue-
level rating on each of HOC's outstanding senior secured second-
priority and senior unsecured debt issues to 'C', from 'CCC-' and
'CC', respectively. S&P also lowered the issue-level rating on
Caesars Entertainment Inc.'s subordinated debt issues to 'C' from
'CC'. In addition, S&P placed the 'B-' issue-level rating for
HOC's senior secured first-lien credit facilities on CreditWatch
with negative implications.
These actions follow Harrah's announcement that it is offering to
exchange up to $2.8 billion of new 10% senior secured second-
priority notes due 2018 for a portion (or potentially all in some
cases) of each of the outstanding senior unsecured and
subordinated notes in the company's capital structure.
HAWAIIAN TELCOM: Court Exclusivity Extension Shorter by 1 Month
---------------------------------------------------------------
Hawaiian Telcom Communications Inc. asked the U.S. Bankruptcy
Court for the District of Hawaii to extend its exclusive period to
file a Chapter 11 plan until July 30, 2009. The Bankruptcy Court,
however, granted only a June 30 extension for the Debtor and its
affiliates to file their Chapter 11 plan.
In its request for an exclusivity extension, Hawaiian Telcom
indicated that it has been working "to address the myriad of
creditor concerns" while continuing "their analysis of
restructuring alternatives."
Based in Honolulu, Hawaii, Hawaiian Telecom Communications, Inc.
-- http://www.hawaiiantel.com/-- operates a telecommunications
company, which offers an array of telecommunications products and
services including local and long distance service, high-speed
Internet, wireless services, and print directory and Internet
directory services.
The company and seven of its affiliates filed for Chapter 11
protection on Dec. 1, 2008 (Bankr. D. Del. Lead Case No. 08-
13086). As reported by the Troubled Company Reporter on
December 30, 2008, Judge Peter Walsh of the U.S. Bankruptcy Court
for the District of Delaware approved the transfer of the Chapter
11 cases to the U.S. Bankruptcy Court for the District of Hawaii
before Judge Lloyd King (Bankr. D. Hawaii Lead Case No. 08-02005).
Richard M. Cieri, Esq., Paul M. Basta, Esq., and Christopher J.
Marcus, Esq., at Kirkland & Ellis LLP, represent the Debtors in
their restructuring efforts. The Debtors proposed Lazard Freres &
Co. LLC as investment banker; Zolfo Cooper Management LLC as
business advisor; Deloitte & Touche LLP as independent auditors;
and Kurztman Carson Consultants LLC as notice and claims agent.
An official committee of unsecured creditors has been appointed in
the case. The committee is represented by Christopher J. Muzzi,
Esq., at Moseley Biehl Tsugawa Lau & Muzzi LLC, in Honolulu,
Hawaii.
When the Debtors filed for protection from their creditors, they
listed total assets of $1,352,000,000 and total debts of
$1,269,000,000 as of Sept. 30, 2008.
Bankruptcy Creditors' Service, Inc., publishes Hawaiian Telcom
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Hawaiian Telcom Communications, Inc. and seven of
its affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
HAYES LEMMERZ: Determines Erratic Financial Report from 2006-2008
-----------------------------------------------------------------
The Audit Committee of Hayes Lemmerz International, Inc., has
determined that the Company's previously issued financial
statements included in these periodic reports should no longer be
relied upon due to errors in the loss per common share data as set
forth in the Statements of Operations for the accounting periods:
Accounting Period Periodic Report
--------------------------------------------------------------
Twelve Months Ended January 31, 2008 Annual Report on
Form 10-K filed
April 10, 2008
Twelve Months Ended January 31, 2007
Twelve Months Ended January 31, 2006
--------------------------------------------------------------
Three Months Ended April 30, 2007 Quarterly Report on
Form 10-Q filed
June 5, 2008
--------------------------------------------------------------
Three and Six Months Ended Quarterly Report on Form
July 31, 2007 10-Q filed September 4,
2008
--------------------------------------------------------------
Three and Six Months Ended Amendment to Quarterly
July 31, 2007 Report on Form 10-Q/A
filed September 13, 2007
Three and Six Months Ended
July 31, 2006
--------------------------------------------------------------
Three and Nine Months Ended Quarterly Report on
October 31, 2007 Form 10-Q filed
December 5, 2008
--------------------------------------------------------------
Three and Nine Months Ended Quarterly Report on
October 31, 2007 Form 10-Q
filed December 10, 2007
Three and Nine Months Ended
October 31, 2006
--------------------------------------------------------------
The Company explained that the weighted average shares outstanding
data for the periods were not adjusted in accordance with
Paragraph 55 of Statement of Financial Accounting Standards No.
128, Earnings Per Share (SFAS 128) in connection with the
Company's equity rights offering in May 2007. SFAS 128 provides
that if a rights issue is offered to all existing stockholders at
an exercise price that is less than the fair value of the stock,
then the weighted average shares outstanding and basic and diluted
earnings per share will be adjusted retroactively for the bonus
element for all periods presented. Because the Company had a loss
in all relevant periods, there is no difference between basic and
diluted earnings per share data.
The company included in its regulatory filing tables setting forth
the corrected loss per common share data for:
* Twelve months ended each of January 31, 2008, January 31,
2007 and January 31, 2006;
* Three, six and nine months ended each of April 30, 2006,
July 30, 2006 and October 31, 2006;
* Three, six and nine months ended each of April 30, 2007,
July 31, 2007 and October 31, 2007
A full-text copy of the Company's regulatory filing, including the
financial tables, is available at no charge at:
http://ResearchArchives.com/t/s?3a5e
The Company said no other periods or financial statements were
affected by this error. The Audit Committee has discussed the
matter with the Company's independent auditors.
About Hayes Lemmerz International
Based in Northville, Michigan, Hayes Lemmerz International Inc.
(Nasdaq: HAYZ) -- http://www.hayes-lemmerz.com/-- is a supplier
of automotive and commercial highway wheels, brakes and powertrain
components. Hayes Lemmerz International, Inc. is a world leading
global supplier of automotive and commercial highway wheels. The
Company has 23 facilities and approximately 7,000 employees
worldwide.
* * *
In January 2009, Hayes Lemmerz International, Inc., and its
subsidiaries, HLI Operating Company, Inc. and Hayes Lemmerz
Finance LLC - Luxembourg S.C.A. entered into Amendment No. 1 to
its Second Amended and Restated Credit Agreement dated as of
May 30, 2007, with the lenders and issuers from time to time party
thereto, Citicorp North America, Inc., as Administrative Agent and
Documentation Agent; and Deutsche Bank Securities Inc., as
Syndication Agent. The Amendment favorably modifies the leverage
ratio and interest coverage ratio covenants for the fourth quarter
of fiscal 2008 and for each quarter of fiscal 2009. In light of
the extremely difficult industry and economic conditions, no
assurance can be given that the company will be able to satisfy
the amended covenants.
Also in January, the three major ratings agencies slashed Hayes-
Lemmerz International Inc.'s ratings.
Standard & Poor's Ratings Services lowered its corporate credit
rating on automotive wheel manufacturer Hayes Lemmerz
International Inc. to 'B-' from 'B'. At the same time, S&P also
lowered its issue-level ratings on the company's debt. All
ratings on the company remain on CreditWatch with negative
implications, where they were placed on Nov. 14, 2008. "The
downgrades reflect our view that declining auto sales and
production in North America and Europe during 2009 could lead to
higher leverage and thin liquidity as Hayes struggles to reduce
its negative free operating cash flow over the next several
quarters," said Standard & Poor's credit analyst Gregg Lemos
Stein.
Fitch Ratings downgraded the Issuer Default Ratings and
outstanding debt ratings of Hayes Lemmerz and subsidiaries to non-
investment grade.
Moody's Investors Service lowered the Corporate Family and
Probability of Default ratings of HLI Operating Company, Inc., a
wholly-owned subsidiary of Hayes Lemmerz International, to Caa1
from B3. Moody's also lowered these ratings: HLI Operating
Company's senior secured bank facilities to B3 from B2; and Hayes
Lemmerz Finance's (Luxembourg S.a.r.l.) secured term loan and
synthetic letter of credit facility to B3 from B2, and its senior
unsecured notes to Caa3 from Caa2. The ratings remain under review
for further downgrade.
HEARST CORP: Seattle Post-Intelligencer Ends Print Edition
----------------------------------------------------------
Shira Ovide at The Wall Street Journal reports that Hearst Corp.
has decided to abandon the print edition of its Seattle Post-
Intelligencer newspaper.
As reported by the Troubled Company Reporter on March 12, 2009,
Hearst said on January 9, 2009, that the Company would take 60
days to decide whether to sell Post-Intelligencer, convert it into
a Web site, or close it down.
WSJ relates that for Hearst, the online-only Post-Intelligencer
provides a laboratory to test new ideas for its 16-paper chain,
which includes the Houston Chronicle and the San Francisco
Chronicle. Citing people familiar with the matter, WSJ states
that Hearst will stop the online Post-Intelligencer right away if
it falters.
Steven Swartz, president of Hearst newspapers, said that Hearst
couldn't continue to absorb Post-Intelligencer's losses, which the
Company said reached $14 million in 2008, WSJ reports.
According to WSJ, Post-Intelligencer's will reduce its work force,
scaling back its news coverage and selling different kinds of
online advertising. Post-Intelligencer, says WSJ, is keeping 20
of its reporters to work on the online operation, laying off
almost 90% of its newsroom employees, or 145 workers. Post-
Intelligencer is hiring more than 20 people to sell advertising
for its Web operation, WSJ says.
About Hearst Corporation
Hearst Corporation -- http://www.hearst.com/-- is a diversified
communications company. Its major interests include 16 daily and
49 weekly newspapers, including the Houston Chronicle, San
Francisco Chronicle and Albany Times Union; as well as interests
in an additional 43 daily and 72 non-daily newspapers owned by
MediaNews Group, which include the Denver Post and Salt Lake
Tribune; nearly 200 magazines around the world, including
Cosmopolitan and O, The Oprah Magazine; 28 television stations
through Hearst-Argyle Television which reach a combined 18% of
U.S. viewers; ownership in leading cable networks, including
Lifetime Television, A&E Television Networks, The History Channel
and ESPN; as well as business publishing, Internet businesses,
television production, newspaper features distribution and real
estate.
HELEN JEAN COOLEY: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Helen Jean Cooley
d/b/a Marsol
701 E. Weldon Ave.
Fresno, CA 93704
Bankruptcy Case No.: 09-11761
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
Eastern District of California (Fresno)
Judge: W. Richard Lee
Debtor's Counsel: M. Nelson Enmark, Esq.
3855 N. West Ave., #108
Fresno, CA 93705
Tel: (559) 229-4613
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/caeb09-11761.pdf
The petition was signed by Helen Jean Cooley.
HELLER EHRMAN: Court Sets April 27 General Claims Bar Date
----------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California
has established April 27, 2009, at 4:30 p.m., Pacific time, for
creditors of Heller Ehrman LLP to file proofs of claims against
the estate of the Debtor.
Governmental units have until June 26, 2009, at 4:30 p.m., Pacific
time, to file proofs of claim.
Proofs of claim must be mailed on or before the applicable bar
date to the following address (as applicable):
a) Bankruptcy Court Street Address:
Clerk of the Court
United States Bankruptcy Court
Northern District of California
235 Pine Street, 19th Floor
San Francisco, CA 94104
b) Bankruptcy Court Mailing Address:
Clerk of the Court
United States Bankruptcy Court
Northern District of California
P.O. Box 7341
San Francisco, CA 94120-7341
Headquartered in San Francisco, California, Heller, Ehrman, White
& McAuliffe, LLP -- http://www.hewm.com/-- filed a voluntary
petition under Chapter 11 of the Bankruptcy Code on December 28,
2008 (Bankr. N.D. Calif., Case No. 08-32514). Members of the
firm's dissolution committee led by Peter J. Benvenutte approved a
plan dated Sept. 26, 2008, to dissolve the firm.
The Hon. Dennis Montali presides over the case. John D. Fiero,
Esq., and Miriam Khatiblou, Esq., at Pachulski, Stang, Ziehl,
Young and Jones, represents the Debtors as counsel. The firm
listed assets and debts between $50 million and $100 million each
in its filing. According to reports, the firm still has roughly
$63 million in assets and 54 employees at the time of its filing.
HOVNANIAN ENTERPRISES: Difficult Market Cues Fitch's Junk Rating
----------------------------------------------------------------
Fitch Ratings has downgraded Hovnanian Enterprises, Inc.'s Issuer
Default Rating and other outstanding debt ratings:
-- IDR to 'CCC' from 'B-';
-- Senior secured revolving credit facility to 'B+/RR1' from
'BB-/RR1';
-- Senior secured notes to 'B+/RR1' from 'BB-/RR1';
-- Senior unsecured notes to 'CC/RR5' from 'B-/RR4';
-- Senior subordinated notes to 'C/RR6' from 'CCC/RR6';
-- Series A perpetual preferred stock to 'C/RR6' from 'CCC-
/RR6'.
Fitch's Recovery Rating of '1' on HOV's secured revolving credit
facility and senior secured second and third-lien notes indicates
outstanding (90%-100%) recovery prospects for holders of these
debt issues. The 'RR5' on HOV's senior unsecured notes indicates
below average (10%-30%) recovery prospects for holders of these
debt issues. HOV's exposure to claims made pursuant to
performance bonds and the possibility that part of these
contingent liabilities would have a claim against the company's
assets were considered in determining the recovery for the
unsecured debt holders. The 'RR6' on HOV's senior subordinated
notes and preferred stock indicates poor recovery prospects (0%-
10%) in a default scenario. Fitch applied a liquidation value
analysis for these RRs.
The downgrade reflects the current very difficult U.S. housing
market and Fitch's expectations that the housing environment
remains challenging for the remainder of the year and perhaps into
2010. The sharply contracting economy and impaired mortgage
markets are, of course, contributing to the housing shortfall.
The ratings changes also reflect persistent negative trends in
HOV's operating margins, further deterioration in credit metrics
and erosion in tangible net worth from non-cash real estate
charges and operating losses.
Cash flow from operations will sharply decline or be slightly
negative in 2009 and likely will be negative in 2010. Real estate
impairments should moderate this year, but will persist so long as
home prices decline and the sales absorption rate shrinks.
HOV generated $476.3 million of cash from operations during the
latest 12 months from Jan. 31, 2009 and ended the quarter with
$842.6 million of cash on the balance sheet. HOV has no major
debt maturities until January 2010, when $100 million of senior
subordinated notes become due. The next maturity after that is in
April 2012.
During 2008 HOV accessed the capital markets to improve its
liquidity position. In May 2008 the company issued $600 million
of 11 1/2% senior notes due 2013. In mid 2008 HOV issued
14 million shares of common stock at a price of $9.50 per share
and realized net proceeds of $126 million. Most recently, HOV
issued an aggregate principal amount of $29.3 million of 18%
senior secured notes (third-priority lien) due 2017 in exchange
for certain of the company's senior unsecured notes in a private
exchange offer. The senior unsecured notes exchanged in the
transaction totaled $71.4 million. The debt exchange was an
opportunistic transaction for HOV that allowed the company to
reduce debt by approximately $42.1 million and extend the maturity
of $29.3 million of current debt to 2017. During the first
quarter of 2009 the company repurchased $53 million of face value
of unsecured senior and senior subordinated notes for $15 million
in cash. Since the end of the first quarter, HOV purchased about
$240 million of face value of unsecured senior notes and
$75 million of face value of unsecured senior subordinated notes
for approximately $105 million in cash. This resulted in
approximately a $210 million gain and a corresponding increase in
stockholders' equity.
Ratings for HOV are influenced by the company's execution of its
business model, land policies and geographic, price point and
product line diversity. HOV has been an active consolidator in
the homebuilding industry which had contributed to above average
growth during the seven years ending in 2005, but had kept debt
levels somewhat higher than its peers. Above average leverage was
also related to the company's delay in braking its internally
generated expansion during the earlier stages of the housing
contraction. Significant insider ownership aligns management's
interests with HOV's long-term financial health.
Future ratings will be influenced by the economy and broad housing
market trends as well as company-specific activity, such as land
and development spending, general inventory levels, speculative
inventory activity (including the impact of high cancellation
rates on such activity), gross and net new-order activity, debt
levels and especially free cash flow trends and uses and the
company's cash position.
INDEPENDENT BANK: Moody's Withdraws 'D' Bank Strength Rating
------------------------------------------------------------
Moody's Investors Service withdrew its ratings for Independent
Bank (bank financial strength at D, deposits at Ba2/Not-Prime,
other senior obligations at Ba3/Not-Prime, and issuer rating at
Ba3) for business reasons. Please refer to Moody's Withdrawal
Policy on moodys.com.
Independent Bank Corporation is headquartered in Ionia, Michigan
and reported total assets of $3.0 billion at December 31, 2008.
The last rating action on Independent Bank was on March 12, 2009,
when Moody's affirmed the bank's ratings and maintained a negative
outlook.
Outlook Actions:
Issuer: Independent Bank
-- Outlook, Changed To Rating Withdrawn From Negative
Withdrawals:
Issuer: Independent Bank
-- Bank Financial Strength Rating, Withdrawn, previously rated D
-- Issuer Rating, Withdrawn, previously rated Ba3
-- OSO Rating, Withdrawn, previously rated NP
-- Deposit Rating, Withdrawn, previously rated NP
-- OSO Senior Unsecured OSO Rating, Withdrawn, previously rated
Ba3
-- Senior Unsecured Deposit Rating, Withdrawn, previously rated
Ba2
INTERNATIONAL COAL: S&P Downgrades Corp. Family Rating to 'Caa2'
----------------------------------------------------------------
Moody's Investors Service downgraded the corporate family rating
of International Coal Group, Inc. to Caa2 from Caa1. The
speculative grade liquidity rating of SGL-4 was affirmed. The
rating outlook was revised to negative from stable.
The downgrade to Caa2 considers the ongoing operational challenges
and the heightened uncertainty surrounding ICG's ability to
maintain a sufficient liquidity position for the duration of the
economic downturn. Given the company's history of operating
difficulties and productivity issues at its mines, Moody's
believes that ICG's costs are likely to continue rising. In
Moody's opinion, this may pressure cash flow despite higher
contracted coal prices in 2009 and 2010. ICG has committed and
priced the majority of its anticipated production in 2009, but
half of its production remains uncommitted in 2010 and is subject
to price risk in a protracted economic downturn.
The SGL-4 speculative grade liquidity rating continues to consider
Moody's opinion of ICG's weak liquidity and the potential for
covenant violations over the next twelve months. Internal
liquidity is provided by $63.9 million of balance sheet cash at
December 31, 2008 and cash flow from operations. However, Moody's
believes that free cash flow could be negative even after
considering the recently reduced capital expenditure budget for
2009. Moody's notes that this expectation is more conservative
than the company's forecast.
The negative outlook reflects Moody's concerns about the potential
for erosion in ICG's liquidity profile and uncertainty regarding
the company's ability to maintain covenant compliance under its
$100 million revolving credit facility in a difficult credit
market. While ICG successfully amended its revolver covenants in
February 2009, the facility is subject to increasingly restrictive
covenant tests throughout 2009. The facility is currently only
used to collateralize approximately $74 million of letters of
credit, but Moody's expects it may be an important source of
additional liquidity in the future.
Ratings affected by the actions include:
-- Corporate Family Rating Lowered to Caa2 from Caa1
-- Senior Secured Rating Affirmed at B1 (with LGD point estimate
remaining at LGD 2; 13%)
-- 10.25% Senior Unsecured Notes Lowered to Caa3 (LGD 4; 66%)
from Caa2 (LGD 4; 67%)
-- Outlook changed to negative from stable
The last rating action was on July 23, 2007, when Moody's lowered
the corporate family rating of ICG to Caa1.
International Coal Group, Inc., operates 13 coal mining complexes
(8 in Central Appalachia, 4 in Northern Appalachia, and 1 in the
Illinois Basin). ICG owns approximately two-thirds of its
1.0 billion tons of coal reserves. The company produced
17.9 million tons of coal in 2008.
INTERSTATE HOTELS: NYSE Suspension Cues Moody's Junk Rating
-----------------------------------------------------------
Moody's Investors Service has downgraded the ratings of Interstate
Hotels & Resorts, Inc. (corporate family rating to Caa1 from B2)
and Interstate Operating Company, L.P. (senior secured debt to
Caa1 from B2). The ratings were placed on review for possible
downgrade.
The rating action follows the announcement that Interstate has
been suspended from trading on the NYSE effective March 12, 2009,
due to the firm's market capitalization falling below the
$15 million minimum requirement. The delisting constitutes a
technical default under the firm's senior secured credit facility.
Interstate's external auditors, KPMG, will be including a "going
concern" explanatory paragraph in its audit opinion, which creates
a separate technical default. Interstate is currently in
negotiations with its bank lenders seeking a waiver of both events
of default. In addition, Interstate is in danger of breaching the
leverage covenant of its senior secured credit facility at the end
of 2009 and intends to seek a modification of this covenant in
conjunction with the extension of the facility, due March 2010.
Moody's will closely monitor the outcome of this process and its
credit implications during its review of Interstate's ratings.
Moody's also noted that Interstate is facing severe operational
headwinds as a result of the dramatic contraction in the lodging
demand, in line with the global economic recession. Still, the
firm benefits from a large portfolio of management contracts,
which generate more stable base management fees than hotel
ownership, and from its experienced executive team.
The rating would likely be stabilized upon successful resolution
of Interstate's liquidity challenges; maintenance of a minimum
fixed charge of 2.5X inclusive of JVs and maximum leverage
(debt/EBITDA) of 6X would also be required. A downgrade would
most likely occur should Interstate not be successful in
addressing its liquidity concerns over the next few months. In
this event, multiple-notch downgrade could be possible.
These ratings were downgraded and placed on review for possible
downgrade:
* Interstate Hotel & Resorts, Inc. -- corporate family rating to
Caa1 from B2
* Interstate Operating Company, L.P. -- senior secured debt to
Caa1 from B2
Moody's last rating action with respect to Interstate was on
June 12, 2008, when Moody's downgraded Interstate's ratings to B2
from B1 and changed the rating outlook to stable from negative.
Interstate Hotels & Resorts is based in Arlington, Virginia, USA
and has ownership interests in 57 hotels and resorts, including
seven wholly owned assets. Together with these properties, the
company and its affiliates manage a total of 216 hospitality
properties with over 46,000 rooms in 37 states, the District of
Columbia, Russia, Mexico, Belgium, Canada, and Ireland.
INT'L COASTAL: Issued of $30MM Unlegended Shares; May File Bankr.
-----------------------------------------------------------------
The management of International Coastal Biofuels has discovered
that possibly more than 70,000,000 shares of ICBU stock was issued
without restricted legend pursuant to a 504 exemption. This was
done in spite of the fact that the stock was trading at
approximately $.45 when the issuance occurred thus making the
value of the issuance in excess of $30,000,000. The 504 exemption
becomes invalid if the dollar amount issued exceeds $1,000,000.
Based on this information, management and its counsel believe that
the shares should have not been issued without a restrictive
legend and are in fact Unlegended, Unregistered shares that are
not eligible to trade on the Pink Sheets Market.
The Company and its counsel are conducting an investigation into
the issuance and have notified the Securities Exchange Commission,
Pink Sheets and its Transfer Agent about its current findings.
The Company is exploring all of its options including the
likelihood of filing a petition for bankruptcy protection.
International Coastal Biofuels also disclosed that Jimmy Cooper,
its former CEO of International Coastal Biofuels, has resigned his
positions as CEO and Director. John T. Moran, the former CEO of
International Coastal Biofuels, has been elected CEO and Sole
Director. Mr. Moran has an irrevocable proxy on all of Mr.
Cooper's stock.
Based in West Palm Beach, Florida, International Coastal Biofuels
(Pink Sheets: ICBU) is a shell company with no business and no
material assets. Management believes there are 350,000 shares of
its stock that are validly free trading.
INVESTMENTS USA: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Investments USA, Inc.
7963 Van Nuys Blvd Ste 104B
Panorama City, CA 91402
Bankruptcy Case No.: 09-12468
Chapter 11 Petition Date: March 6, 2009
Court: United States Bankruptcy Court
Central District of California (San Fernando Valley)
Judge: Kathleen Thompson
Debtor's Counsel: Robert M. Yaspan, Esq.
Law Offices of Robert M Yaspan
21700 Oxnard St Ste 1750
Woodland Hills, CA 91367
Tel: 818-905-7711
Fax : 818-501-7711
Email: tmenachian@yaspanthau.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/cadb09-12468.pdf
The petition was signed by Sumit Ghosh, president of the Company.
IRWIN VICTOR AUTREY: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Irwin Victor Autrey
4440 W. Main St., Ste #3
Dothan, AL 36305
Bankruptcy Case No.: 09-10449
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Carmel Properties Group, LLC 09-10446
SEAL Investments, LLC 09-10447
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Middle District of Alabama (Dothan)
Debtor's Counsel: Collier H. Espy, Jr., Esq.
Espy, Metcalf & Espy, P.C.
P.O. Drawer 6504
Dothan, AL 36302-6504
Tel: (334) 793-6288
Email: KC@EMPPC.COM
Estimated Assets: $100,001 to $500,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/almb09-10449.pdf
The petition was signed by Irwin Victor Autrey.
JAMES THURSTON PATTERSON: Voluntary Chapter 11 Case Summary
-----------------------------------------------------------
Debtor: James Thurston Patterson
f/d/b/a Premiere Partners
6097 Woodland Hills Dr.
Nashville, TN 37211
Bankruptcy Case No.: 09-02503
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Sandra Dianne Ray 09-00316
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Middle District of Tennessee (Nashville)
Judge: Keith M. Lundin
Debtor's Counsel: Steven L. Lefkovitz, Esq.
Law Offices Lefkovitz & Lefkovitz
618 Church St., Ste. 410
Nashville, TN 37219
Tel: (615) 256-8300
Fax: (615) 250-4926
Email: Stevelefkovitz@aol.com
Total Assets: $5,093,772.50
Total Debts: $6,723,783.30
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/tnmb09-02503.pdf
The petition was signed by James Thurston Patterson.
JAMIE VERGARA: Wants Kosto & Rotella as Bankruptcy Counsel
----------------------------------------------------------
Jamie Ruben Vergara and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the Middle District of Florida to
employ Lawrence M. Kosto, Esq., and the law firm Kosto & Rotella,
P.A., as counsel.
Kosto & Rotell will:
a) advise the Debtors with respect to their rights, powers,
duties and obligations as debtor-in-possession in the
administration of these cases, the operation of its
business and the management of its property;
b) prepare pleadings, applications, and conduct examinations
incidental to administration;
c) advise and represent the Debtors in its connection with all
applications, motions and complaints for reclamation,
adequate protection, sequestration, relief from stays,
appointment of a trustee or examiner and all other similar
matters;
d) examine and object to the claims of creditors in these
cases;
e) advise and assist the debtor-in-possession in the
formulation and presentation of a Plan of Reorganization
and concerning any and all matters relating thereto; and
f) perform any and all other legal services incident and
necessary herein.
The Debtors propose to employ Kosto & Rotella under a general
retainer of $20,000 to be billed against the lawyer's hourly rate
of $300, the paralegal's hourly rate of $100, plus costs.
To the best of the Debtors' knowledge, Kosto & Rotella is a
"disintereted person" as that term is defined in Section 101(14)
of the Bankruptcy Code.
Mr. Kosto can be reached at:
Kosto & Rotella, P.A.
619 East Washington Street
P.O. Box 113
Orlando, FL 32802
Tel: (407) 425-3456
Fax: (407) 423-9002
About Jamie Ruben Vergara
Headquartered in Orlando, Florida, Jamie Ruben Vergara and its
debtor-affiliates filed for Chapter 11 protection on March 9,
2009, (Bankr. M.D. Fla. Lead Case No.: 09-02751) Lawrence M.
Kosto, Esq. at Kosto & Rotella PA represents the Debtors in their
restructuring efforts. The Debtors listed estimated assets of $10
million to $50 million and estimated debts of $10 million to $50
million.
JAWS II LLC: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Jaws II, LLC
2243 North Euclid Ave.
Upland, CA 91784
Bankruptcy Case No.: 09-65925
Type of Business: The company is single asset real estate debtor.
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Judge: James Massey
Debtor's Counsel: Edward F. Danowitz, Jr., Esq.
Danowitz & Associates, P.C.
300 Galleria Parkway, NW, Suite 960
Atlanta, GA 30339
Tel: (770) 933-0960
Email: edanowitz@danowitzlegal.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A list of the Debtor's largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/ganb09-65925.pdf
The petition was signed by Rob D. Walker, Manager of the Company.
JERRY FITCH: Voluntary Chapter 11 Case Summary
----------------------------------------------
Debtor: Jerry S. Fitch
P.O. Box 27
Holly Springs, MS 38635
Bankruptcy Case No.: 09-11105
Debtor-affiliates filing separate Chapter 11 petitions:
Entity Case No.
------ --------
Fitch Oil Company, Inc. 08-12812
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Northern District of Mississippi (Aberdeen)
Debtor's Counsel: Toni Campbell Parker, Esq.
P.O. Box 240666
615 Oakleaf Office Lane
Memphis, TN 38124-0666
Tel: (901) 483-1020
Fax: (866) 489-7938
Email: tparker001@bellsouth.net
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/msnb09-11105.pdf
The petition was signed by Jerry S. Fitch.
JKMD INVESTMENTS: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Debtor: JKMD Investments, LLC
318 N. Carson St., #208
Carson City, NV 89701
Bankruptcy Case No.: 09-50579
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
District of Nevada (Reno)
Judge: Gregg W. Zive
Debtor's Counsel: Jeffrey L. Hartman, Esq.
Hartman & Hartman
510 West Plumb Lane, Ste. B
Reno, NV 89509
Tel: (775) 324-2800
Fax: (775) 324-1818
Email: notices@bankruptcyreno.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/nvb09-50579.pdf
The petition was signed by Darlene M.K. Covington, Trustee/Manager
of the Company.
KEITH PICKLE: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Keith C. Pickle
aka Keith Pickle Timber Co.
and Cynthia K. Pickle
aka Cindy F. Pickle
aka Cindy K. Pickle
Post Office Box 1490
Lyons, GA 30436
Bankruptcy Case No.: 09-60196
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Southern District of Georgia (Statesboro)
Debtor's Counsel: Jesse C. Stone, Esq.
Merrill & Stone, LLC
P O Box 129
Swainsboro, GA 30401
Tel: 478-237-7029
Fax : 478-237-9211
Email: bkymail@merrillstonehamilton.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/gasb09-60196.pdf
The petition was signed by Keith C. Pickle and Cynthia K. Pickle.
LEHMAN BROTHERS: Broker Dealers Given First Priority Liens
----------------------------------------------------------
Judge James Peck of the U.S. Bankruptcy Court for the Southern
District of New York granted the request of Lehman Brothers
Holdings, Inc. and its debtor-affiliates, and gave certain broker
dealers first priority liens in cash, securities and other
collateral that will be posted in connection with the hedging
transactions the Debtors may enter into with those dealers.
The Debtors that are counterparty to the hedging transactions are
allowed to use only their own assets to post collateral and are
not authorized to post those exceeding industry standards as
adjusted for a debtor-in-possession. The Debtors are not
permitted to post as collateral those properties in which other
parties assert ownership interest, including Newport Global
Opportunities Fund LP, Newport Global Credit Fund (Master) LP,
PEP Credit Investor LP, Providence TMT Special Situations Fund LP
and other parties.
The Debtors have until April 10, 2009, to establish a separate
bank account in the name of Lehman Brothers Holdings, Inc.,
titled "Barclays First Lien Account" and deposit $10.5 million in
that account.
The Court held that the first priority liens granted to Barclays
Bank PLC and Barclays Capital, Inc., under the interim order
approving the proposed postpetition financing and under the order
approving the sale of the investment management division "will be
contemporaneously extinguished upon the deposit of $10.5 million
into the Barclays First Lien Account " and replaced by first
priority liens against the account.
The $10.5 million will not be used unless (i) the Debtors obtain
the Court's authorization upon notice and hearing or (ii) the
Debtors, Barclays Bank and Barclays Capital consensually resolve
any and all of the U.K. companies' claims under the Debtor-In-
Possession Credit Agreement dated September 17, 2008, and the DIP
order.
Debtors, Committee Agree On Protocol
In connection with their entry into hedging transactions, the
Debtors and the Official Committee of Unsecured Creditors agreed
on these Court-approved protocols governing the panel's
involvement and the parameters to be used by the Debtors
regarding the transactions:
(1) All proposed hedging transactions will be reviewed by an
approval committee established by the Debtors. The
financial advisors to the Creditors' Committee will receive
notice of, and may attend, all meetings of the approval
committee and will have access to the personnel of the
Debtors involved with the proposed hedging transactions.
(2) "Open Derivative Position" means, in reference to the
hedging protocol, an unterminated individual derivative
contract or unterminated multiple derivative contracts
with one or more counterparties the proposed hedge or
hedges for which will be substantially similar and
transacted at the same time.
(3) With respect to all proposed hedging transactions, the
Debtors will provide (i) e-mail notification to the
Creditors' Committee's financial advisors of any meeting
regarding the approval of a hedging transaction not later
than one day prior to the meeting. The e-mail must
contain the material terms of the proposed hedging
transaction. The Debtors must also provide information
package as soon as practicable but not less than three
days prior to the meeting, which consists of (i) legal
documentation for the "open derivative position;" (ii)
valuation statements; (iii) valuation inputs and
assumptions used by the approval committee that relate to
and were used to determine the mid-market value of the
open derivative position and adjustments thereto; and (iv)
appropriate and customary risk measurement information
calculated using standard market conventions.
(4) Informal discussions among the Debtors and the Creditors'
Committee's financial advisors relative to hedging Group A
Positions will commence no later than five days prior to
the meeting.
(5) The Debtors may enter into a proposed hedging transaction
for which the receivable of the open derivative position
has a mid-market value in favor of the applicable Debtor
greater than $25,000,000 -- Group A Position -- only if
(i) the Creditors' Committee, a subcommittee or other
designee thereof consents one day before the hedging
transaction is scheduled to be executed or two days after
a meeting during which the transaction was approved, or
(ii) upon court approval.
(6) The Debtors may enter into a proposed hedging transaction
for which the open derivative position is $25,000,000 or
less only (i) if the advisors receive e-mail notification
of the hedging transaction which will include the material
terms of the approved hedging transaction; at least one
member of the advisors attended the portion of the meeting
during which the proposed hedging transaction was
discussed and approved; and the financial advisors to the
Creditors' Committee do not object within six business
hours, of and after receipt of e-mail notification of the
committee's approval of the hedging transaction or (ii)
upon court approval.
(7) After the approval of a proposed hedging transaction, any
further maintenance of such hedge by the Debtors will not
require further approval by the Committee or any
designated subcommittee thereof or other designee,
provided that if a Debtor's original strategy is changed
or determined to be inappropriate with respect to a
particular hedging transaction, the advisors may commence
a review of such hedging transaction at the meeting
occurring on the next day.
(8) The Debtors will provide updates regarding the number of
Hedging transactions that have been executed; the value of
the collateral posted in connection with those hedging
transactions; and an estimate of the mark to market value
of the receivables from the corresponding open trades at
least once every three months during (i) the Debtors'
periodic case conferences to the Court, (ii) presentations
made to the Creditors' Committee that are made public, or
(iii) other presentations made available to all parties in
interest.
(9) The Debtors and the Committee reserve all rights
and remedies with respect to the hedging protocol and may
seek to amend the protocol upon court approval.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed $639 billion in assets
and $613 billion in debts, effectively making the firm's
bankruptcy filing the largest in U.S. history. Several affiliates
filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion -- US$38
billion. Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Court Approves LCPI & LBHI Letter Agreements
-------------------------------------------------------------
Judge James Peck of the U.S. Bankruptcy Court for the Southern
District of New York approved letter agreements that Lehman
Commercial Paper Inc. and Lehman Brothers Holdings Inc. entered
into with:
(1) AIB International Finance
(2) Tara Hill B.V.
(3) Deutsche Bank AG
(4) Deutsche Bank Trust Company Americas
(5) Lloyds TSB Bank
(6) Avenue Investments L.P.
The Court authorized LCPI and LBHI to enter into agreements to
modify and assume eight trades, a list of which is available for
free at http://bankrupt.com/misc/LBHIAmendedTrades.pdf
The Court also permitted the Debtors to assume 16 trades listed
at http://bankrupt.com/misc/LBHIAssumedTrades.pdfand reject 14
trades at http://bankrupt.com/misc/LBHIRejectedTrades.pdf
The Court will hold a hearing on March 25, 2009, at 10:00 a.m.,
to consider an objection of R3 Capital Management LLC to the
Debtors' request.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed $639 billion in assets
and $613 billion in debts, effectively making the firm's
bankruptcy filing the largest in U.S. history. Several affiliates
filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion -- US$38
billion. Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Can Hire Huron Consulting as Tax Advisors
----------------------------------------------------------
Judge James Peck of the U.S. Bankruptcy Court for the Southern
District of New York granted Lehman Brothers Holdings, Inc. and
its debtor-affiliates authority to employ Huron Consulting Group
as their tax services providers effective January 23, 2009.
As reported by the Troubled Company Reporter on March 11, 2009,
the Debtors tapped the consulting firm to provide personnel to
work with their internal tax department and prepare for the filing
of tax returns. About six to 20 personnel will be assigned for
the job and will be directly supervised by Jacqueline O'Neil,
managing director of Huron Consulting.
The Debtors will pay Huron Consulting's according to these hourly
rates:
Managing Director $325 - $730
Director $225 - $620
Manager $185 - $575
Associate $185 - $345
Analyst $125 - $245
The Debtors will also reimburse Huron Consulting at a single
blended billing rate of $145 per hour based on its estimation of
the amount of effort and the experience required for providing
those services. The firm will also be reimbursed of its expenses
and will be indemnified for any losses or damages incurred in
connection with its employment.
In case Huron Consulting is required to provide tax services
other than those contemplated under their engagement agreement
with the Debtors, the firm will be paid for those services at
these rates:
Tax Managing Director $350
Tax Senior Director $250
Tax Manager $185
Tax Associate $125
Robert Pawlak, a managing director of Huron Consulting, assures
the Court that his firm "neither holds nor represents an interest
adverse to the Debtors or their estates with respect to the
matters on which Huron is to be employed."
Richard P. Krasnow, Esq., at Weil, Gotshal & Manges LLP, in New
York, told the Court through a certification of counsel, that no
objection to the employment application was timely filed or
received.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed $639 billion in assets
and $613 billion in debts, effectively making the firm's
bankruptcy filing the largest in U.S. history. Several affiliates
filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion -- US$38
billion. Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Barclays Settle Disputes on Pacts to Be Assumed
----------------------------------------------------------------
In October 2008, as part of the sale of Lehman Brothers, Inc.,
LBI notified the U.S. Bankruptcy Court for the Southern District
of New York that it will assume a Pricing Services Agreement and a
Terms and Conditions for Use of the Lehman Brothers Global Family
of Indices and Analytics Services LBI entered into with Fidelity
Investments. LBI proposed to assign the contracts to the
purchaser, Barclays Capital, Inc.
Fidelity informally objected to the proposed assumption and
assignment of the Terms and Conditions on the ground that there
is no documented agreement to assume and assign. Fidelity,
however, did not object to the proposed assumption and assignment
of the Pricing Services Agreement.
To resolve the dispute, Barclays and Fidelity, in a Court-
approved stipulation, agree that the Terms and Condition and the
Pricing Service Agreement have been assumed and assigned. The
parties further agree that the SIPA Trustee and the LBI estate
will have no obligations related to the Terms and Conditions.
Barclays Resolves 70+ Objections
In a notice dated February 25, 2009, Barclays Capital announced
that it has resolved the objections of these companies to the
proposed assumption of their contracts and to the amounts that
will be paid to them to cure defaults under the contracts:
* Abovenet Communications Inc
* A.C. Nielsen Company
* ACL Services Ltd.
* ADP, Inc
* Advantage Human Resourcing
* AECSoft USA, Inc.
* AKF Engineers
* Arizona Biltmore Resort & Spa Waldorf
Astoria Management LLC
* AT&T
* AVM/III
* Bell South
* BGC Partners, Inc.
* CB Richard Ellis
* Charles B. Strauss
* Charles River Development/Charles River Brokerage LLC
* Ciena Communications
* Cingular Wireless
* Clayton Fixed Income Services, Inc.
* CMS Innovative Consultants
* CURRENEX
* DataCert, Inc.
* Eurest
* Factset Research Systems
* First Derivatives PLC
* Fortify Software Inc.
* Frictionless Commerce
* FX Alliance LLC
* FX Connect
* GL Trade, Inc.
* Greenwich Associates
* Hewlett Packard
* Hilliard Farber
* Huron Consulting Group
* ICAP
* ICE
* I-Deal LLC
* Informatica Corporation
* Intechra LLC
* Internap Network Service Corp
* Intralinks Inc.
* Intuition Publishing, Inc.
* IPC Information Systems
* Iron Mountain Incorporated
* Joseph McMurray
* Kenneth Heinze
* MarketAxess
* McLarty Associates
* Michael Stapleton Associates
* MicroDesign Services/SS&C Technologies NJ
* Murphy & Durieu
* NASDAQ Stock Market
* NetApp, Inc
* NPD Intellect Inc.
* NYSE - Wombat
* NYSE Market Inc
* NYSE Transaction Inc.
* PEI Systems, Inc.
* PGB
* Pitney Bowes
* PORTWARE LLC
* Prenax, Inc.
* Pyxis Solutions LLC
* Responsive Data Solutions
* Southwestern Bell
* Spectron Energy Services Limited
* Spiral Binding Company, Inc.
* Sterling Commerce Inc.
* Strategic Insight
* Tangoe Inc.
* Tata Americas International Corporation
* Toronto Stock Exchange
* Tradition
* TriOptima - Credits
* TRX Data Services
* United Parcel Service
* TATA Communications Services Inc.
* West Point Derivatives Ltd.
Meanwhile, Moody's Corporation has withdrawn its objection and
motion for payment of the "cure amount." The company did not
cite its reason for the withdrawal.
AmEx Responds
American Express Travel Related Services Company says that
Barclays Capital failed to show that the "attorney-client
privilege" and "attorney work product protection" applies and was
not waived with respect to the communication between its
attorneys, Jason White and Lindsee Granfield.
"Rather than submit fresh affidavits into evidence to support its
assertions, Barclays tries to convince the Court, through
conclusory statements, that Mr. White's statement declaration
does not mean what it actually says," says Irena Goldstein, Esq.,
at Dewey & Leboeuf LLP, in New York.
Barclays Capital earlier filed under seal court papers reportedly
arguing that Mr. White did not divulge the substance of his
communication with Ms. Granfield.
Ms. Goldstein further says that Barclays Capital could not also
establish that the communication between its attorneys was made
in anticipation of the litigation.
"Barclays submitted no affidavit testimony as to when anyone had
the subjective believe that litigation was likely. Instead,
Barclays mischaracterizes the facts and asserts that the mistake
was always the listing of AmEx's contracts," Ms. Goldstein
further says.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed $639 billion in assets
and $613 billion in debts, effectively making the firm's
bankruptcy filing the largest in U.S. history. Several affiliates
filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion -- US$38
billion. Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Turnberry Sues Bank Unit for Contract Breach
-------------------------------------------------------------
Turnberry/Centra Sub, LLC, and its affiliates filed a lawsuit
against Lehman Brothers Holdings, Inc., and Lehman Brothers Bank
FSB for alleged breach of their contract.
The Debtors allegedly breached their contract after they refused
to fund the development of Town Square, a 93-acre high-end,
mixed-use lifestyle center owned by Turnberry Associates in Las
Vegas, Nevada.
The Debtors reportedly committed to provide long-term financing
and a $95 million advance for the development project. Relying
on this commitment, Turnberry Associates stopped negotiating with
other financial institutions interested in providing long-term
financing for the project.
Following their bankruptcy filing, the Debtors allegedly refused
to honor further draw requests on the advance.
James Carr, Esq., at Kelley Drye & Warren LLP, in New York, says
the companies need to have access to the funds to complete the
project and start generating income. He says that the companies
also intend to use the funds to develop parcels of land adjacent
to the Town Square which "absent prompt development, Turnberry
will have to forfeit back to Clark County."
Mr. Carr says the companies have already paid millions of dollars
in extension fees as a result of the Debtors' failure to honor
their commitment. He adds that "substantial job losses" might
also result if the projects would not be completed.
Hank's Living Trust Suit
Meanwhile, Hank's Living Trust filed a lawsuit against Lehman
Brothers OTC Derivatives, Inc., and Lehman Brothers Holdings,
Inc., to recover 75,000 shares of Google Inc. common stock. The
stocks were posted as collateral for a collar transaction entered
into between Hank's Living Trust and Lehman Brothers OTC way back
in 2006.
In its complaint filed before the Court, Hank's Living Trust said
that the collar transaction expired unexercised on December 19,
2008, which triggered Lehman Brothers OTC's obligation to
immediately return the stock. Lehman Brothers OTC, however, has
allegedly refused to return the stock.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed $639 billion in assets
and $613 billion in debts, effectively making the firm's
bankruptcy filing the largest in U.S. history. Several affiliates
filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion -- US$38
billion. Akio Katsuragi, a former Morgan Stanley executive, runs
Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEHMAN BROTHERS: Permitted to Repo With Bank Subsidiary
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has authorized Lehman Brothers Holdings Inc. to enter into a
$325 million repurchase agreement with a non-debtor unit Lehman
Brothers Bank FSB.
According to the report, the transaction will give the Lehman bank
the financing it needs to avoid defaulting obligations and in the
process enables the Lehman parent to preserve its $467 million
equity in the bank.
Bloomberg's Bill Rochelle points out that Lehman was authorized in
February to inject $272 million of capital into a Utah bank it
owns named Woodlands Commercial Bank.
Lehman Brothers' Collapse
Founded in 1850, Lehman Brothers Holdings Inc. --
http://www.lehman.com-- was the fourth largest investment bank in
the United States, offering a full array of financial services in
equity and fixed income sales, trading and research, investment
banking, asset management, private investment management and
private equity. Its worldwide headquarters in New York and
regional headquarters in London and Tokyo are complemented by a
network of offices in North America, Europe, the Middle East,
Latin America and the Asia Pacific region.
Lehman filed for chapter 11 on Sept. 15, 2008 (Bankr. S.D.N.Y.
Case No. 08-13555) after Barclays PLC and Bank of America Corp.
backed out of a deal to acquire the company, and the U.S. Treasury
refused to provide financial support that would have eased out a
sale. Lehman's bankruptcy petition listed
$639 billion in assets and $613 billion in debts, effectively
making the firm's bankruptcy filing the largest in U.S. history.
Several affiliates filed bankruptcy petitions thereafter.
On Sept. 19, 2008, Lehman Brothers, Inc., was placed in
liquidation pursuant to the provisions of the Securities Investor
Protection Act (Case No. 08-CIV-8119). James W. Giddens was
appointed trustee for the SIPA liquidation of the business of LBI.
Lehman Brothers Finance AG, aka Lehman Brothers Finance SA, filed
a petition under Chapter 15 of the U.S. Bankruptcy Code on
February 10, 2009. Lehman Brothers Finance, a subsidiary of
Lehman Brothers Inc., estimated both its assets and liabilities at
more than $1 billion.
LBHI's U.S. bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, has been placed into administration,
together with Lehman Brothers Ltd., LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to wind down the business of LBI
(Europe) on Sept. 15, 2008.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on Sept. 16. The
two units have combined liabilities of JPY4 trillion --
US$38 billion. Akio Katsuragi, a former Morgan Stanley executive,
runs Lehman's Japan units.
Lehman Brothers Asia Limited, Lehman Brothers Securities Asia
Limited and Lehman Brothers Futures Asia Limited suspended
operations upon the bankruptcy filing of their U.S. counterparts.
Asset Sales
Barclays Bank Plc has acquired Lehman's North American
investment banking and capital markets operations and supporting
infrastructure for US$1.75 billion. Nomura Holdings Inc., the
largest brokerage house in Japan, on Sept. 22 reached an agreement
to purchased Lehman Brothers Holdings, Inc.'s operations in Europe
and the Middle East less than 24 hours after it reached a deal to
buy Lehman's operations in the Asia Pacific for US$225 million.
Nomura paid only US$2 dollars for Lehman's investment banking and
equities businesses in Europe, but agreed to retain most of
Lehman's employees.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc. and its various
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
LEIGHTON CENTRE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Leighton Centre, LLC
1001 Lleighton Avenue
P.O. Box 3585
Anniston, AL 36201
Tel: (205)237-9586
Bankruptcy Case No.: 09-40652
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Northern District of Alabama (Anniston)
Debtor's Counsel: Thomas J. Knight, Esq.
P.O. Drawer 1850
Anniston, AL 36202
Tel: 205 237-9586
Email: hubbardknight@msn.com
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Fifth Third Bank Unstated Unstated
c/o Danny Hunter
10200 David Taylor Drive
Charlotte, NC 28262-2373
Wright Media LLC Unstated Unstated
P.O. Box 696
Anniston, AL 36202
The petition was signed by David D. House, Managing Member of the
Company.
LENOX GROUP: Court Defers Chapter 11 Plan Hearings and Deadlines
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
noticed on March 13, 2009, that all dates and deadlines
articulated within the Disclosure Statement and the Joint
Chapter 11 Plan of Lenox Sales, Inc., et al., are suspended, and
any hearing dates in connection with the motions seeking the
approval of the adequacy of the Disclosure Statement and
confirmation of the Plan, and the March 18, 2009 hearing, are
adjourned sine die.
As reported in the Troubled Company Reporter on March 17, 2009,
the asset sale of Lenox Group Inc. to a group led by Clarion
Capital Partners, LLC, has been completed. The "New Lenox," which
includes the Lenox, Dansk, Gorham and Department 56 brands, will
now operate outside of Chapter 11 bankruptcy.
Headquartered in Bristol, Pennsylvania, Lenox Group Inc. --
http://www.department56.com/,http://www.lenox.com/,and
http://www.dansk.com/-- including its two main operating
subsidiaries, D 56, Inc. and Lenox, Incorporated, is a leading
designer, marketer, distributor, wholesaler, manufacturer and
retailer of quality tableware, collectibles, and other giftware
products under the Lenox, Dansk, Gorham, and Department 56 brand
names. These products are sold through department stores, large
specialty retailers, general merchandise chains, national chains
and clubs, small independent specialty retailers, and other
wholesale accounts.
The company and six of its affiliates filed for Chapter 11
protetcion on November 23, 2008 (Bankr. S.D. N.Y. Lead Case No.
08-14679). Harvey R. Miller, Esq., and Alfredo R. Perez, Esq., at
Weil, Gotshal & Manges LLP, represent the Debtors in their
restructuring efforts. The Debtors proposed Berenson &
Company as financial advisor, Carl Marks Advisory Group LLC as
consultants, and The Garden City Group as claims and noticing
agent. Debtors have $264,000,000 in total assets and $238,000,000
in total debts as of October 25, 2008.
LEXINGTON PRECISION: Can Use Cash Collateral Until May 22
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has granted Lexington Precision Corporation and Lexington Rubber
Group, Inc. permission to use Cash Collateral of the Prepetition
Senior Lenders through the earlier of either May 22, 2009, or
until the occurrence of a Termination Event.
The Prepetition Senior Lenders are (a) CapitalSource Finance LLC
and Webster Business Creditor Corporation, as agents and lenders
under that certain Credit and Security Agreement, dated as of
May 31, 2006, and (b) CSE Mortgage LLC, as agent and lender, DMD
Special Situations, LLC, as lender under that certain Loan and
Security Agreement, dated as of May 31, 2006.
The Debtors are allowed to use Cash Collateral only for (a)
working capital and capital expenditures, (b) other general
corporate purposes of the Debtors, (c) the costs of administration
of these Chapter 11 cases, and (c) the consummation of the
connector seals consolidation, in accordance with a thirteen week
budget.
As adequate protection for the use of Cash Collateral, the
Prepetition Lenders shall receive:
i) adequate protection payments in amounts as provided in the
Court order;
ii) for any diminution in the value of the Prepetition Senior
Lenders' interests in the Collateral, (a) replacement
security interests in all of the Debtors assets, (b) first
priority security interests in all unencumbered assets of
the Debtors, and (c) junior liens on all encumbered assets
not otherwise subject to the Prepetition Secured Lenders'
liens;
iii) for any diminution in the value of the Prepetition Senior
Lenders' interests in the Cash Collateral, an
administrative expense claim pursuant to Sec. 507(b) of the
Bankruptcy Code.
The Senior Lender Prepetition Liens, the Adequate Protection
Liens, and the DIP Super-Priority Claim will be subject to a
Carve-Out for the payment of: (i) fees of the clerk of the
Bankruptcy Court and the United States Trustee; (ii) reasonable
fees and expenses of a trustee that are incurred after the
conversion of these Chapter 11 cases to a case under Chapter 7 of
the Bankruptcy Code; and (iii) upon the occurrence of the
Termination Date or the Maturity Date, the aggregate allowed
unpaid professional fees and expenses of professionals retained in
the Debtors' Chapter 11 cases.
A full-text copy of the Court's March 4, 2009 Cash Collateral
order is available at:
http://bankrupt.com/misc/LexingtonPrecisionCashCollateralOrder.pdf
About Lexington Precision
Headquartered in New York, Lexington Precision Corp.
-- http://www.lexingtonprecision.com/-- manufactures tight-
tolerance rubber and metal components for use in medical,
automotive, and industrial applications. As of Feb. 29, 2008, the
Company employed about 651 regular and 22 temporary personnel.
The Company and its affiliate, Lexington Rubber Group Inc., filed
for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead
Case No.08-11153). Christopher J. Marcus, Esq., and Victoria
Vron, Esq., at Weil, Gotshal & Manges, represent the Debtors in
their restructuring efforts. The Debtors selected Epiq Systems -
Bankruptcy Solutions LLC as claims agent. The U.S. Trustee for
Region 2 appointed six creditors to serve on an Official Committee
of Unsecured Creditors. Paul N. Silverstein, Esq., and Jonathan
Levine, Esq., at Andrews Kurth LLP, represent the Committee as
counsel.
At December 31, 2008, the Debtors had total assets of $53,354,000,
total liabilities of $100,061,000, and a stockholders' deficit of
$46,707,000.
LEXINGTON PRECISION: Court Appoints Seymour Preston as Mediator
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the appointment of Seymour Preston, Jr., of Goldin
Associates as mediator to facilite resolution of disputed issues
in the bankruptcy cases of Lexington Precision Corp., et al.
The subject matter of the mediation will be the Debtors'
enterprise value and any other related issues the parties agree to
include in the mediation process.
The Court also ordered that, by April 3, 2009, and every two weeks
thereafter, the parties to the mediation will jointly provide a
status report to the Court regarding the mediation and whether the
mediation process has concluded or is continuing.
Before joining Goldin Associates, Mr. Seymour was a senior
managing director and head of Restructuring at Furman Selz
Incorporated and managing director and head of the Investment
Recovery Group at Equitable Capital Management Corp. and The
Equitable Life Assurance Society.
Seymour is a Chartered Financial Analyst charter holder and a
graduate of Princeton University and New York University School of
Law.
About Lexington Precision
Headquartered in New York, Lexington Precision Corp.
-- http://www.lexingtonprecision.com/-- manufactures tight-
tolerance rubber and metal components for use in medical,
automotive, and industrial applications. As of Feb. 29, 2008, the
Company employed about 651 regular and 22 temporary personnel.
The Company and its affiliate, Lexington Rubber Group Inc., filed
for Chapter 11 protection on April 1, 2008 (Bankr. S.D.N.Y. Lead
Case No.08-11153). Christopher J. Marcus, Esq., and Victoria
Vron, Esq., at Weil, Gotshal & Manges, represent the Debtors in
their restructuring efforts. The Debtors selected Epiq Systems -
Bankruptcy Solutions LLC as claims agent. The U.S. Trustee for
Region 2 appointed six creditors to serve on an Official Committee
of Unsecured Creditors. Paul N. Silverstein, Esq., and Jonathan
Levine, Esq., at Andrews Kurth LLP, represent the Committee as
counsel.
At December 31, 2008, the Debtors had total assets of $53,354,000,
total liabilities of $100,061,000, and a stockholders' deficit of
$46,707,000.
LOSEE & LONE: Voluntary Chapter 11 Case Summary
-----------------------------------------------
Debtor: Losee & Lone Mountain 006, LLC
2865 S. Jones Boulevard
Las Vegas, NV 89146
Bankruptcy Case No.: 09-13152
Type of Business: Losee & Lone Mountain 006, LLC, is a
single-asset, real estate debtor.
Chapter 11 Petition Date: March 8, 2009
Court: United States Bankruptcy Court
District of Nevada (Las Vegas)
Judge: Bruce A. Markell
Debtor's Counsel: Matthew L. Johnson, Esq.
Matthew L. Johnson & Associates, P.C.
8831 W. Sahara Ave.
Las Vegas, NV 89117
Tel:(702) 471-0065
fax :(702) 471-0075
email: bankruptcy@mjohnsonlaw.com
Estimated Assets: $0 to $50,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/NVB09-13152.pdf
The petition was signed by Sonya Haggerty, manager of the Company.
M. TANGREDI'S: CFO Indicted on Tax Evasion & Forgery Charges
------------------------------------------------------------
Nashville Business Journal reports that a Davidson County grand
jury indicted M. Tangredi's Restaurants Inc. Chief Financial
Officer Michael G. Tangredi on charges of tax evasion and forgery.
According to Business Journal, Mr. Tangredi was charged of trying
to defraud the state of Tennessee. The Department of Revenue said
in a press release that it received a forged check from Mr.
Tangredi, claiming that he had already paid sales tax when he had
not.
Business Journal relates that Mr. Tangredi, if convicted, could be
sentenced to a maximum of four years in the state penitentiary and
fined $5,000 for the Class D felony.
M. Tangredi's Restaurants Inc. is a restaurant company based in
Nashville, Tennessee. M. Tangredi's offers Italian dining. The
Company filed for Chapter 11 bankruptcy protection on February 5,
2009 (Bankr. M.D. Tenn. Case No. 09-01211). M. Tangredi's listed
$63,600 in assets and $77,000 in assets.
MANASSEH BUILDING: Wants Access to PNC and FBBH Cash Collateral
---------------------------------------------------------------
Manasseh Building Group, Inc., asks the U.S. Bankruptcy Court for
the Central District Of California for authority to:
-- access the cash collateral associated with associated with
the three income producing apartment buildings owned and
operated by the Debtor located at (a) 7323 Winnetka Avenue,
Winnetka, California; (b) 22761 Vanowen Street, West Hills,
California; and (c) 6737 DeSoto Avenue, Woodland Hills,
California; and
-- grant (a) PNC ARCS, LLC a replacement lien in postpetition
rents, issues and profits of the Winnetka Property, to the
extent of any diminution in value of PNC's interest in
prepetition cash collateral associated with the Winnetka
Property; (b) First Bank of Beverly Hills a replacement
lien in postpetition rents, issues and profits of the
Vanowen Property, to the extent of any diminution in value
of FBBH's interest in prepetition cash collateral
associated with the Vanowen Property; and (c) FBBH a
replacement lien in postpetition rents, issues and profits
of the DeSoto Property, to the extent of any diminution in
value of FBBH's interest in prepetition cash collateral
associated with the DeSoto Property;
The Debtor requires the use of the cash collateral to operate,
maintain and preserve the Winnetka Property, Vanowen Property and
the DeSoto Property, to render the services required by the
occupants thereof and to conduct the day-to-day business
operations of the Debtor.
PNC and FBBH, the secured creditors, allegedly have an interest in
the cash generated by the Winnetka Property and by both the
Vanowen Property and the DeSoto Property.
MBG obtained from PNC a "permanent" loan in the sum of $3,477,000
secured by a first priority deed of trust against the Winnetka
Property. The Winnetka Loan, which matures in October 2018,
requires monthly payments in the sum of $20,534. The Debtor is
current on its obligations under the Winnetka Loan and is not in
default under the Winnetka Loan.
In order to finance MSG's construction of 36 residential units,
MBG, in January 2007, obtained a 'construction loan from FBBH in
the sum of $7,765,000 secured by a first priority deed of trust
against the Vanowen Property. The present interest rate for the
FBBH Vanowen Loan is "one-half of 1% over the "Wall Street Journal
Prime Rate" or 3.5%. The FBBH Vanowen Loan will mature on April
1, 2009.
In September, 2006, obtained a construction loan from FBBH in the
sum of $8,400,000 secured by a first priority deed of trust
against the DeSoto Property. The present 4 II interest rate for
the FBBH DeSoto Loan is three quarters of 1% over the "Wall Street
Journal Prime Rate" or 4%. The FBBH DeSoto Loan matured in
October 2008.
The Debtor relates that the lenders are adequate protected
because: a) the utilization of the putative cash collateral will
generate replacement collateral equal to or in excess of the cash
collateral to be used by the Debtor; (b) the Winnetka Property,
Vanowen Property and the DeSoto Property have equity; and (c) the
maintenance and operation of the real property will preserve and
enhance the value of the PNC's and FBBH's respective collateral.
About Manasseh Building Group, Inc.
Based in Oak Park, California, Manasseh Building Group, Inc.
aka MBG and Pacific Planning and Design operates a real estate
business. The Debtor filed for Chapter 11 protection on March 9,
2009, (Bankr. C.D. Calif. Case No.: 09-12507) Joseph A. Eisenberg,
Esq. at Jeffer, Mangels, Butler & Marmaro LLP represents the
Debtors in its restructuring efforts. The Debtor listed estimated
assets of $10 million to $50 million and estimated debts of $10
million to $50 million.
MARCAL PAPER: Staples Withdraws Objection to Sale of Assets
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey has
approved the stipulation between Staples The Superstore, LLC,
Debtor Marcal Paper Mills Inc., and Marcal Paper Mills, LLC, as
purchaser of the assets of Debtor, giving Staples the right to set
off certain rebates and credits on sales of the Debtor's products
under the Staples Agreements.
The Staples Agreements refer to the Global Vender Program
Agreement and the related GVP Extension Agreement under which the
Debtor agreed to sell certain products to Staples for the calendar
years 2007 and 2008, with volume incentives.
Pursuant to the stipulation, Staples withdraws its objection to
the asset sale and the proposed assumption by the Debtor and
assignment of the Staples Agreements to the Buyer. The Staples
Agreements are deemed assigned to Buyer, cum onere.
Staples is entitled to continue to set off amounts owed it under
the Staples Agreements against amounts otherwise due to the Debtor
or the Buyer (as applicable) in the ordinary course of business
(regardless of whether the setoff occurs prior to, or after, the
date hereof), but only to the extent permitted under the
provisions of the Staples Agreements and applicable non-bankruptcy
law.
The Debtor shall not have any further liabilities under the
Staples Agreement. The Buyer, as the assignee of the Staples
Agreements, shall be the sole party responsible for Vendor's
liabilities and obligations under the Staples Agreements.
On January 29, 2008, the Court approved the sale of certain assets
of the Debtor free and clear of all liens, claims and encumbrances
pursuant to an amended and restated Purchase Agreement, dated as
of November 19, 2007, between the Debtor and Buyer Marcal Paper
Mills, LLC, including the assumption and assigment by the Debtor
of certain executory contracts and leases to the Buyer.
After the entry of the sale order, the Buyer requested that the
Debtor seek to assume the Staples Agreement and assign the same to
the Buyer.
Staples filed a limited objection to the proposed assumption and
assignment of executory contracts asserting, inter alia, that,
under the Staples Agreements, it was entitled to certain rebates
and credit on sales of the Debtors' products in January 2008 and
February 2008.
A full-text copy of the Court's Order resolving the limited
objection by Staples regarding the assumption and assignment of
executory contracts is available at:
http://bankrupt.com/misc/MarcalPaper.StipulationandOrder.pdf
Based in Elmwood Park, New Jersey, Marcal Paper Mills Inc.
-- http://www.marcalpaper.com/-- is a privately-held, fourth
generation family business. Founded in 1932, it employs more than
900 people in its Elmwood Park, New Jersey and Chicago, Illinois
manufacturing operations. The company produces more than 160,000
tons of finished paper products, including bath tissue, kitchen
towels, napkins and facial tissue, distributed to retail outlets
for home consumption and to distributors for away-from-home use in
hotels, restaurants, hospitals, offices and
factories.
The Debtor filed for chapter 11 protection on Nov. 30,
2006 (Bankr. D. N.J. Case No. 06-21886). Attorneys at Andora &
Romano, LLC; Cole, Schotz, Meisel, Forman & Leonard, P.A.;
Windels, Marx, Lane & Mittendorf, LLP; Lowenstein Sandler PC; and
Charles V. Bonin, Esq., represent the Debtor as counsel. The
Debtors selected Logan and Company Inc. as claims agent. Kenneth
Rosen, Esq., Mary E. Seymour, Esq., and Michael Savetsky, Esq., at
Lowenstein Sandler PC ,represent the Official Committee of
Unsecured Creditors. In its schedules filed with the Court, the
Debtor disclosed total assets of $178,626,436 and total debts of
$178,890,725.
MASHANTUCKET WESTERN: S&P Cuts Issuer Credit Rating to 'B+'
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
Mashantucket Western Pequot Tribe, the owner of Foxwoods Resort
Casino in southeastern Connecticut. The issuer credit rating was
lowered to 'B+' from 'BB-'. The ratings were removed from
CreditWatch, where they were placed with negative implications on
Jan. 30, 2009. The rating outlook is negative.
"The ratings downgrade reflects the ongoing challenging operating
climate in the U.S. gaming industry and, as a result, S&P's
expectation that credit measures for the Tribe will remain weak
for the previous rating for an extended period of time," said
Standard & Poor's credit analyst Melissa Long.
While the Foxwoods management team and Tribal leadership have
implemented significant cost-saving measures that have benefitted
earnings in recent quarters, S&P expects that the pullback in
consumer discretionary spending will prevent a return to
meaningful earnings growth at Foxwoods for the remainder of fiscal
2009 (ended Sept. 30). The current 'B+' issuer rating
incorporates S&P's view that EBITDA at Foxwoods could decline in
the mid-single-digit area in fiscal 2009. Under this scenario,
credit measures would not improve to a level aligned with the
previous 'BB-' rating until fiscal 2011 or 2012.
In addition, S&P is concerned about a thinning covenant cushion
associated with the leverage covenant contained in the Foxwoods
credit agreement. While S&P is not currently forecasting a
violation, S&P believes that the cushion relative to this covenant
could decline to the single-digit percentage area. While S&P
expects that an amendment would be the most likely outcome of a
violation, S&P anticipate this would lead to a repricing of the
credit facility. This could result in EBITDA coverage of interest
falling to a level that is somewhat weak for the current rating,
which could pressure an incurrence-based coverage covenant
contained in the Tribe's 8.5% notes.
The 'B+' rating reflects Foxwoods' high debt leverage, a thinning
covenant cushion, limited geographic diversity, and significant
historical and expected distributions to the Tribe. These factors
are partially tempered by the favorable demographics of the
Connecticut market and limited new competition within the next two
to three years.
MASONITE INT'L: Plan Gets Bank Lenders & Bondholders Backing
------------------------------------------------------------
Masonite International Inc. has received strong support from its
bank lender and bondholder constituencies to move forward with its
previously announced debt restructuring plan. If implemented as
proposed, this plan will enable Masonite to reduce its outstanding
debt by nearly $2 billion, from $2.2 billion today to up to $300
million upon consummation of the plan, and reduce its annual cash
interest costs by approximately $145 million.
On March 3, 2009, Masonite announced that it had reached an
agreement in principle with members of a steering committee
representing its senior secured lenders and representatives of an
ad-hoc committee representing holders of its senior subordinated
notes due 2015 on the terms of a restructuring plan that will
create an appropriate capital structure to support the Company's
long-term strategic plan and business objectives. Since then, the
Company has entered into lock-up agreements supporting the
restructuring plan with holders of more than 75 percent in
principal amount of its senior secured obligations and more than
80 percent in principal amount of its senior subordinated notes
due 2015. The minimum threshold required for effectiveness of
these lock-up agreements is 66 percent.
In order to implement this restructuring plan, the Company and
several affiliated companies, including Masonite International
Corporation, today voluntarily filed to reorganize under the
Companies' Creditors Arrangement Act (CCAA) in Canada in the
Ontario Superior Court of Justice. In addition, Masonite
Corporation and all of its U.S. subsidiaries today filed voluntary
petitions for reorganization under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court in Wilmington,
Delaware. Masonite's subsidiaries and affiliates outside of North
America have not initiated reorganization cases and are not
expected to be adversely impacted by the legal proceedings.
"We are very pleased to have received strong support from our
lender and bondholder groups for our debt restructuring plan,"
said Fred Lynch, President and Chief Executive Officer of
Masonite. "We are ahead of schedule and intend to proceed quickly
and expeditiously to implement the plan, which would reduce
Masonite's debt by nearly $2 billion and put our Company in a
stronger, financially healthier position for the future. We
expect to emerge from this process with an appropriate capital
structure to support our long-term business objectives and with
increased financial flexibility both to navigate the current
industry challenges and to take advantage of future growth
opportunities."
Masonite plans to continue to operate as usual during the
restructuring process. The Company's manufacturing and
distribution facilities around the world will continue to serve
customers in the normal course. Pre-negotiated cases typically
are effectuated in 90 to 120 days.
Under the proposed plan, all trade creditors would be
"unimpaired," which means that trade suppliers and vendors would
be paid in full. To this end, the Company has filed motions
seeking authorization from the U.S. and Canadian courts to
continue to pay trade creditors under normal terms in the ordinary
course of business. As of March 12, 2009, the Company had more
than $150 million in cash on hand that will be available to
satisfy obligations associated with conducting the Company's
business in the ordinary course.
As previously announced, under the terms of the proposed
restructuring plan, Masonite's existing Senior Secured Obligations
would be converted on a pro rata basis, subject to the election of
each existing holder of Senior Secured Obligations, into (i) a new
senior secured term loan of up to $200 million, (ii) a new second-
lien PIK Loan of up to
$100 million, and/or (iii) 97.5% of the common equity of a
reorganized Masonite subject to dilution for warrants issued to
the Senior Subordinated Noteholders and management equity and/or
options. Senior Subordinated Notes would be converted to 2.5% of
the common equity in Masonite plus warrants for 17.5% of the
common stock of the Company, subject to dilution for management
equity and/or options. The implementation of the plan is subject
to court approval and closing conditions.
About Masonite International
Based in Ontario, Canada, Masonite International Corporation --
http://www.masonite.com/-- (TSE:MHM) is a vertically integrated
producer, manufacturing key components of doors, including
composite molded and veneer door facings, glass door lites and cut
stock. The company provides these products to its customers in
more than 70 countries around the world. The company is a wholly
owned subsidiary of Masonite International Inc. It offers a range
of interior and exterior doors. Masonite Canada operates Masonite
International's Canadian subsidiaries, well as certain other non-
United States subsidiaries.
Tampa, Florida-based Masonite Corporation and its debtor-
affiliates, including Masonite International Inc., filed for
Chapter 11 bankruptcy protection on March 16, 2009 (Bankr. D.
Delaware Case No. 09-10844). Richard M. Cieri, Esq., Jonathan S.
Henes, Esq., and Christopher J. Marcus, Esq., at Kirkland & Ellis
LLP assist the Debtors in their restructuring efforts. Kurtzman
Carson Consultants LLC is the Debtors' claims agent. The Debtors
listed $1,527,495,443 in assets and $2,641,590,842 in debts as of
January 31, 2009.
MATTHEW GRAHAM MIGHELL: Voluntary Chapter 11 Case Summary
---------------------------------------------------------
Debtor: Matthew Graham Mighell
Diana Marie Mighell
P.O. Box 1775 E Palm Canyon Dr., # 110-354
Palm Springs, CA 92264-1613
Bankruptcy Case No.: 09-14033
Chapter 11 Petition Date: March 4, 2009
Court: United States Bankruptcy Court
Central District of California (Riverside)
Judge: Thomas B. Donovan
Debtor's Counsel: Daniel G. Brown, Esq.
515 Calle De Soto
San Clemente, CA 92672
Tel: (949) 892-1100
Fax: (949) 892-1150
Estimated Assets: $1,000,001 to $10,000,000
Estimated Debts: $1,000,001 to $10,000,000
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/cacb09-14033.pdf
The petition was signed by Matthew Graham Mighell and Diana Marie
Mighell.
MGIC INVESTMENT: Moody's Cuts Senior Unsecured Debt Rating to 'B3'
------------------------------------------------------------------
Moody's Investors Service has downgraded MGIC Investment
Corporation's senior unsecured debt rating to B3 from B2, and its
convertible junior subordinated debt rating to Caa2 from B3.
Moody's has also affirmed the Ba2 insurance financial strength
ratings of Mortgage Guaranty Insurance Corporation and MGIC
Indemnity Corporation. The outlook for the ratings is developing.
According to Moody's, the rating action reflects constrained
financial flexibility at the holding company, MGIC Investment
Corporation, coupled with the company's recent decision to defer
the payment of interest on its convertible junior subordinated
debt. While MGIC Investment currently has approximately
$394 million in liquid assets, the company's bank credit facility
(of which $200 million is currently outstanding) comes due in
2010, and an additional $200 million in senior notes mature in
2011. Moody's said that these upcoming payments, together with
other debt service obligations and the current absence of
unrestricted dividend capacity at MGIC, are likely to place
additional strain on holding company liquidity over the next two
years.
The two notch downgrade of the convertible junior subordinated
debt reflects MGIC's decision to defer its April 1, 2009 interest
payment and the likelihood that the company will continue to defer
interest payments for the next several quarters. While deferred
interest payments are cumulative, the rating reflects the
uncertainty of repayment, if at all, given MGIC's weak financial
condition.
Moody's stated that the developing outlook reflects both the
potential for further deterioration in the insured portfolio of
MGIC, as well as positive developments that could occur over the
near to medium term, including the possibility of a greater than
expected level of claims recissions, the potential for various
initiatives being pursued at the US Federal level to mitigate the
rising trend of mortgage loan defaults, and the possibility that
the mortgage insurers gain access to government capital in a
program similar to the U.S. Treasury's Capital Assistance Program.
Moody's will continue to evaluate MGIC's ratings in the context of
the future performance of the company's insured portfolio relative
to expectations and resulting capital adequacy levels, as well as
changes, if any, to the company's strategic and capital management
plans.
List Of Rating Actions
These ratings have been downgraded, with a developing outlook:
* MGIC Investment Corporation -- senior unsecured debt to B3 from
B2; junior subordinated debt to Caa2 from B3; provisional rating
on senior unsecured debt to (P)B3 from (P)B2.
These ratings were affirmed, with a developing outlook:
* Mortgage Guaranty Insurance Corp -- insurance financial strength
at Ba2;
* MGIC Indemnity Corporation -- insurance financial strength at
Ba2.
The last rating action related to MGIC was on February 13, 2008,
when Moody's downgraded MGIC's insurance financial strength rating
to Ba2 from A1.
MGIC Investment Corporation, headquartered in Milwaukee,
Wisconsin, is the holding company for Mortgage Guaranty Insurance
Company, one of the largest US mortgage insurers with $227 billion
of primary insurance in force at December 31, 2008.
MGM MIRAGE: Discussing Pledging Casinos to Avert Bankruptcy
-----------------------------------------------------------
To avoid bankruptcy, casino owner MGM Mirage is in discussions
with lenders about pledging or selling casinos, Bloomberg's Bill
Rochelle, citing a person with knowledge of the discussions.
At the end of February MGM drew down the remaining $842 million on
the $4.5 billion revolving credit.
Moody's Investors Service said earlier in the month that cash will
be "barely sufficient to fund the company's operations" through
2009, including obligations and debt maturities. Standard &
Poor's has said that the ability to cover $1.1 billion of maturing
bonds in the second and third quarters of 2010 is "in doubt."
According to Bloomberg, MGM is yet to raise all of the $3 billion
needed for the CityCenter development, a 67-acre resort and
residential project in Las Vegas. WSJ notes that MGM already has
about $1.27 billion in bond payments due later this year, in
addition to $674 million in existing interest payments.
As reported by the TCR on March 16, citing The Wall Street
Journal, MGM Mirage could be broken into pieces, as it tries to
negotiate new terms with lenders to avoid defaulting on its debts,
Jeffrey McCracken and Tamara Audi at The Wall Street Journal
report. WSJ quoted a person familiar with the matter as saying,
"Basically everything MGM owns is for sale."
According to WSJ, potential buyers have been considering
purchasing MGM's Bellagio casino as well as its MGM Grand Detroit.
WSJ, citing people familiar with the matter, relates that MGM has
discussed selling the Bellagio but hasn't received an attractive
bid. WSJ notes that MGM recently agreed to sell its Treasure
Island casino hotel in Las Vegas to casino magnate Phil Ruffin for
$775 million.
About MGM Mirage
Headquartered in Las Vegas, Nevada, MGM Mirage (NYSE: MGM) --
http://www.mgmmirage.com/-- is a hotel and gaming company. It
owns and operates 17 properties located in Nevada, Mississippi
and Michigan, and has investments in three other properties in
Nevada, New Jersey and Illinois.
* * *
As reported by the Troubled Company Reporter on March 12, 2009,
Moody's Investors Service downgraded MGM Mirage's Probability of
Default rating to Caa2 from Caa1 and its Corporate Family Rating
to Caa1 from B3.
As reported by the Troubled Company Reporter on March 3, 2009,
Fitch Ratings downgraded MGM MIRAGE's Issuer Default Rating to
'CCC' from 'B'. Fitch said that the rating outlook remains
negative.
According to the TCR on March 3, 2009, Standard & Poor's Ratings
Services lowered its corporate credit and issue-level ratings on
Las Vegas-based MGM MIRAGE by two notches; the corporate credit
rating was lowered to 'B-' from 'B+'. These ratings remain on
CreditWatch with negative implications, where they were initially
placed on Jan. 30, 2009.
MGM MIRAGE: Obtains Senior Credit Facility Waiver Through May 15
----------------------------------------------------------------
MGM Mirage yesterday obtained from the lenders under its senior
credit facility a waiver of the requirement that the Company
comply with the senior credit facility's financial covenants
through May 15, 2009. Under the terms of the amendment, the
Company repaid $300 million of the outstanding borrowings under
its senior revolving credit facility. The amendment provides for
a 100 basis point increase to the interest rate under the senior
credit facility, prohibits the Company from prepaying or
repurchasing any debt or disposing of assets, and allows the
Company to continue to make its required equity contributions to
CityCenter through May 15, 2009.
At December 31, 2008, the Company had approximately $13.5 billion
of total long-term debt. In late February 2009, the Company
borrowed $842 million under its senior credit facility, which
amount represented -- after giving effect to $93 million in
outstanding letters of credit -- the total amount of unused
borrowing capacity available under its $7.0 billion senior credit
facility. In connection with the waiver and amendment, the
Company repaid $300 million under the senior revolving credit
facility, which amount is not available for re-borrowing without
the consent of the lenders.
The Company was in compliance with its financial covenants under
its senior credit facility at December 31, 2008. The Company,
however, noted that if the recent adverse conditions in the
economy in general -- and the gaming industry in particular --
continue, it believes that it will not be in compliance with the
financial covenants during 2009. In fact, given the conditions
and the recent borrowing under its senior credit facility, the
Company does not expect to be in compliance with the financial
covenants at March 31, 2009.
Following expiration of the waiver on May 15, 2009, the Company
will be subject to an event of default related to the expected
noncompliance with financial covenants under the senior credit
facility at March 31, 2009.
The Company intends to work with its lenders to obtain additional
waivers or amendments prior to that time to address future
noncompliance with the senior credit facility; however, the
Company provided no assurance that it will be able to secure such
waivers or amendments.
The Company said the lenders holding at least a majority of the
principal amount under the Company's senior credit facility could,
among other actions, accelerate the obligation to repay borrowings
under the senior credit facility in an event of default. As a
result of the event of default, under certain circumstances, cross
defaults could occur under the Company's indentures and the
CityCenter $1.8 billion senior secured credit facility, which
could accelerate the obligation to repay amounts outstanding under
such indentures and the CityCenter credit facility and could
result in termination of the unfunded commitments under the
CityCenter credit facility.
The Company notes that the report of its independent registered
public accounting firm on the Company's consolidated financial
statements for the year ended December 31, 2008, contains an
explanatory paragraph with respect to the Company's ability to
continue as a going concern.
On Tuesday, the Company reported a fourth quarter net loss of
$1.14 billion. The Company reported $855.2 million in net loss
for year 2008. The Company had $23.2 billion in total assets and
$19.3 billion in total liabilities as of December 31, 2008. The
Company's balance sheet shows strained liquidity with
$1.53 billion in current assets on $3.00 billion in current
liabilities.
"We are pleased to have obtained this waiver and amendment of our
senior credit facility. While there is still work to be done, this
is a positive step that provides us with the opportunity to
continue to work with our financial advisors and our bank group in
addressing the Company's current financial position," said Jim
Murren, Chairman and Chief Executive Officer of MGM MIRAGE. "The
current economic climate remains challenging, but we are still
driving high occupancy at our resorts, which are in terrific
shape. We continue to provide our guests with world-class
customer service and a renewed value proposition."
"We view the recently executed waiver and amendment as a strong
show of support by our long-term relationship banks," said
Executive Vice President and Chief Financial Officer of MGM
MIRAGE, Dan D'Arrigo. "We look forward to further dialog with our
lenders as we consider all viable options to improve our capital
structure, which may include asset dispositions, raising
additional debt and/or equity capital, and modifying or extending
our outstanding debt."
About MGM Mirage
Headquartered in Las Vegas, Nevada, MGM Mirage (NYSE: MGM) --
http://www.mgmmirage.com/-- is a hotel and gaming company. It
owns and operates 17 properties located in Nevada, Mississippi
and Michigan, and has investments in three other properties in
Nevada, New Jersey and Illinois.
* * *
As reported by the Troubled Company Reporter on March 12, 2009,
Moody's Investors Service downgraded MGM Mirage's Probability of
Default rating to Caa2 from Caa1 and its Corporate Family Rating
to Caa1 from B3.
As reported by the Troubled Company Reporter on March 3, 2009,
Fitch Ratings downgraded MGM MIRAGE's Issuer Default Rating to
'CCC' from 'B'. Fitch said that the rating outlook remains
negative.
According to the TCR on March 3, 2009, Standard & Poor's Ratings
Services lowered its corporate credit and issue-level ratings on
Las Vegas-based MGM MIRAGE by two notches; the corporate credit
rating was lowered to 'B-' from 'B+'. These ratings remain on
CreditWatch with negative implications, where they were initially
placed on Jan. 30, 2009.
MIRABILIS VENTURES: Settles Forfeiture With U.S. Government
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida
(Orlando) has authorized Mirabilis Ventures Inc. to enter into a
settlement with the U.S. government in connection with a dispute
over whether a forfeiture action against the company's property
was automatically halted when it filed bankruptcy.
According to Bloomberg's Bill Rochelle, Mirabilis had earlier
wanted the U.S. Government held in contempt of the Bankruptcy Curt
for continuing a forfeiture action aimed at taking away the
Company's property based on a fraud the U.S. Attorney says was
perpetrated by Frank Amodeo, the principal of the Company.
The settlement, Bloomberg relates, divided property between what
will go to the government in forfeiture and what the company will
retain. The settlement obliges Mirabilis to set up a liquidating
trust in which the government will have an oversight role. The
trust is to receive and distribute money collected in the Chapter
11 case. In addition, the government has an approved unsecured
claim for $200 million in the bankruptcy.
Mr. Amodeo, Mr. Rochelle recalls, was indicted in August and later
pleaded guilty to four counts. The government describes him as
having conducted a "systematic and pervasive theft of payroll
taxes" amounting to $182 million.
Orlando, Florida-based Mirabilis Ventures Inc., together with two
of its affiliates, filed for Chapter 11 protection on May 27, 2008
(Bankr. M.D. Fla. Lead Case No. 08-04327). Elizabeth A. Green,
Esq., at Latham Shuker Eden & Beaudine LLP, represents the Debtors
in their restructuring efforts. When the Debtors filed for
protection from their creditors, they listed estimated assets and
debts of $50 million to $100 million.
MYERS MILL: Court Okays G. Jeuter as Interim Trustee
-----------------------------------------------------
The Hon. J. Rich Leonard of the U.S. Bankruptcy Court for the
Eastern District of North Carolina as approved the appointment of
Gerald A. Jeuter Jr. as interim trustee in Myers Mills LLC's
bankruptcy case.
Mr. Jeuter is a board certified specialist in bankruptcy law as
certified by the North Carolina State Bar Board of Legal
Specialization.
Headquartered in Charlotte, North Carolina, real estate company
Myers Mill LLC filed for Chapter 11 protection on Sept. 22, 2008
(Bankrk. E.D. N.C. Case No. 08-06508). Laurie B. Biggs, Esq., and
Trawick H. Stubbs, Jr., at Stubbs & Perdue, PA, represents the
Debtor as counsel. In its schedules, the company listed total
assets of $13,986,640 and total debts of $10,817,772.
The Debtors are North Carolina and South Carolina limited
liability companies that engage in the business of land
development. The Debtors' members are J. Franklin Martin, Scott
A. Stover, and Matthew A. McDonald. The Debtors' affiliate and
managing member, Landcraft Management, LLC and its predecessor
Landcraft Properties, Inc. have been engaged in the real estate
development business for over 20 years. J. Franklin Martin, Scott
A. Stover, and Matthew A. Mcdonald are the sole members of
Landcraft. Each of the Debtors is the owner of a single piece of
real estate, which is in the process of being developed into a
subdivision.
Some of the Debtors are currently being managed by Landcraft
Communities, LLC, which is a limited liability company owned by
Messrs. Martin, Stover, and McDonald, on an interim basis. The
remaining Debtors are being managed by Landcraft Management, LLC.
On June 27, 2008, Eagle Creek, Eagles Trace, Back Creek, Aumond
Glen, and Saddlebrook filed their Chapter 11 cases. On Sept. 22,
2008, The Heights, Kelsey Glen, The Rapids at Belmeade, Water
Mill, Chandler Oaks, Myers Mill, and River Chase filed their
Chapter 11 petitions. On Oct. 9, 2008, The Village at Windsor
Creek and Lismore Park filed their Chapter 11 petitions. On
Oct. 15, 2008, Old Towne filed its Chapter 11 petition. On
Oct. 29, 2008, Caledonia filed its Chapter 11 petition.
NAILITE INT'L: Has $3MM DIP Loan; To Auction Assets on April 8
--------------------------------------------------------------
Nailite International Inc., obtained from the U.S. Bankruptcy
Court for the District of Delaware (i) approval to further market
its business at an auction on April 8, and (ii) final approval for
$3 million of debtor-in-possession financing from the lead bidder
at the auction, Premier Exteriors LLC.
Nailite will sell its business to Premier Exteriors, an Aurora,
Illinois-based siding and window installer, absent higher and
better bids for the Debtor's assets.
The Debtor has signed a contract to sell its business to Premier
in exchange for $8 million of an existing loan. Premier purchased
the first-lien secured debt in January.
Competing bids are due April 6, two days before the auction. The
Court will consider approval of the sale to Premier or the winning
bidder at the auction on April 13.
On February 26, 2009, the Debtor entered into an asset purchase
agreement with Premier Exterios. Premier Exteriors proposed to
acquire the assets for a total purchase consideration, calculated
as of the Closing Date, equal to: (i) obligations in the amount of
$8.0 million outstanding as of the Petition Date including the
outstanding principal balance of the Notes, plus the
amount of any accrued and unpaid interest payable through the
Auction Date; plus (ii) cash in the amount of $650,000; plus (iii)
assumption of certain liabilities.
A full-text copy of the approved Bid Procedures is available at:
http://bankrupt.com/misc/NailiteInternational.BidProcedures.pdf
About Nailite International
Headquartered in Miami, Florida, Nailite International Inc. --
http://www.nailiteinternational.com-- produces injection
polypropylene based cedar and masonry replica siding. The Debtor
supplies residential construction and remodeling markets through
various building materials and siding distributors. Nailite is
wholly-owned by Granham Partners, a private equity investor from
Wayne, Pennsylvania.
Nailite International filed for Chapter 11 on Feb. 13, 2009
(Bankr. D. Del., Case No. 09-10526). Gabriel R. MacConaill, Esq.,
and Steven M. Yoder, Esq., at Potter Anderson & Corroon LLP, have
been tapped as counsel. AlixPartners LLP is also on-board as
restructuring adviser. In its bankruptcy petition, the company
estimated assets and debts of $50 million to
$100 million.
NAT'L SPORTS ATTRACTION: To Liquidate Under Chapter 7
-----------------------------------------------------
National Sports Attraction LLC, doing business as New York's
Sports Museum of America, filed a petition under Chapter 7 of the
Bankruptcy Code to liquidate its assets to pay off creditors. The
petition was filed in Manhattan March 13.
According to Bloomberg's Bill Rochelle, the privately-owned
attraction in Manhattan's Wall Street district opened last year at
a cost of $97 million, closed in February leaving $57 million
owing on tax exempt bonds. The museum had defaulted on the bonds
by September, the report added.
In its Chapter 7 petition, the Company listed assets of $55.6
million and debt totaling $177.1 million, including $50.9 million
in secured claims.
PACIFIC ENERGY: Court Restricts Trading in Equity Interests
-----------------------------------------------------------
The United States Bankruptcy Court for the District of Delaware
has entered an order in the bankruptcy cases of Pacific Energy
Resources Ltd. and its affiliates, restricting the trading in the
Debtors' securities.
The Court entered an Order that imposes substantial restrictions
on trading in equity interests, Pacific Energy said in a news
statement.
Headquartered in Long Beach, California, Pacific Energy Resources
Ltd. -- http://www.pacenergy.com-- engage in the acquisition and
development of oil and gas properties, primarily in the United
States. The company and seven of its affiliates filed for Chapter
11 protection on March 8, 2009 (Bankr. D. Del. Lead Case No. 09-
10785). James E. O'Neill, Esq., Kathleen P. Makowski, Esq., and
Laura Davis Jones, Esq., at Pachulski Stang Ziehl & Jones LLP,
represents the Debtors in their restructuring efforts. The
Debtors proposed Rutan & Tucker LLP as their corporate counsel;
Schully, Roberts, Slattery & Marino as special oil and gas
counsel; Devlin Jensen as Canadian counsel; Zolfo Cooper as
financial advisor; Lazard Freres & Co. LLC and Albrecht &
Associates Inc. as investment bankers; and Omni Management Group
LLC as noticing and claims agent. When the Debtors filed for
protection from their creditors, they listed assets and debts
between $100 million and $500 million each.
PHILADELPHIA NEWSPAPERS: Court Sets May 25 as Claims Bar Date
-------------------------------------------------------------
The United States Bankruptcy Court for the Eastern District of
Pennsylvania set May 25, 2009, as deadline for creditors of
Philadelphia Newspapers LLC and its debtor-affiliates to file
their proofs of claim.
All governmental units have until Aug. 21, 2009, to file their
proofs of claim.
All proofs of claim must be delivered to:
The Garden City Group Inc.
Attn: Philadelphia Newspapers LLC
P.O. Box 9000 #6528
Merrick, NY 11566-9000
--- or ---
The Garden City Group Inc.
The Garden City Group Inc.
Attn: Philadelphia Newspapers LLC
105 Maxes Road
Melville, NY 11747
About Philadelphia Newspapers
Philadelphia Newspapers, LLC -- http://www.philly.com/-- owns and
operate numerous print and online publications in the Philadelphia
market, including the Philadelphia Inquirer, the Philadelphia
Daily News, several community newspapers, the region's number one
local Web site, philly.com, and a number of related online
products. The Company's flagship publications are the Inquirer,
the third oldest newspaper in the country and the winner of
numerous Pulitzer Prizes and other journalistic recognitions, and
the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D.
Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. The Debtors listed assets and debts
of $100 million to $500 million.
PHILADELPHIA NEWSPAPERS: DIP Financing Hearing Moved to March 31
----------------------------------------------------------------
The Philadelphia Inquirer reports that Philadelphia Newspapers LLC
and its senior creditors have agreed that the Hon. Jean K.
FitzSimons of the U.S. Bankruptcy Court for the Eastern District
Pennsylvania in Philadelphia postpone a hearing on the debtor-in-
possession financing to March 31, 2009.
As reported by the Troubled Company Reporter on March 12, 2009,
the Court previously postponed until March 17 the hearing on
Philadelphia Newspapers' request to access $25 million in
financing from affiliates of its owners. Objections had been
filed against the terms of the DIP Loan.
Lawrence G. McMichael, a Dilworth Paxson L.L.P. lawyer who
represents Philadelphia Newspapers, said that the hearing was
postponed for the third time as the two sides continue talking
about ways to resolve their dispute over the financing, according
to The Philadelphia Inquirer.
Philadelphia Newspapers' day-to-day finances are in good shape and
it could continue funding its operations from cash flow until the
end of April, The Philadelphia Inquirer says, citing Mr.
McMichael.
Philadelphia Newspapers reached an agreement with Peco Energy to
provide a $275,000 deposit for the Company's utility bill,
Philadelphia Inquirer relates.
Philadelphia Newspapers, LLC -- http://www.philly.com/-- owns and
operate numerous print and online publications in the Philadelphia
market, including the Philadelphia Inquirer, the Philadelphia
Daily News, several community newspapers, the region's number one
local Web site, philly.com, and a number of related online
products. The Company's flagship publications are the Inquirer,
the third oldest newspaper in the country and the winner of
numerous Pulitzer Prizes and other journalistic recognitions, and
the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D.
Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. The Debtors listed assets and debts
of $100 million to $500 million.
PHILADELPHIA NEWSPAPERS: Has Until April 15 to File Schedules
-------------------------------------------------------------
The United States Bankruptcy Court for the Eastern District of
Pennsylvania extended until April 15, 2009, the period within
which Philadelphia Newspapers LLC and its debtor-affiliates may
file their schedules of assets and liabilities, and statement of
financial affairs.
About Philadelphia Newspapers
Philadelphia Newspapers, LLC -- http://www.philly.com/-- owns and
operate numerous print and online publications in the Philadelphia
market, including the Philadelphia Inquirer, the Philadelphia
Daily News, several community newspapers, the region's number one
local Web site, philly.com, and a number of related online
products. The Company's flagship publications are the Inquirer,
the third oldest newspaper in the country and the winner of
numerous Pulitzer Prizes and other journalistic recognitions, and
the Daily News.
Philadelphia Newspapers and its debtor-affiliates filed for
Chapter 11 bankruptcy protection on February 22, 2008 (Bankr. E.D.
Pa. Case No. 09-11204). Proskauer Rose LLP is the Debtors'
bankruptcy counsel, while Lawrence G. McMichael, Esq., at Dilworth
Paxson LLP is the local counsel. The Debtors' financial advisor
is Jefferies & Company Inc. The Debtors listed assets and debts
of $100 million to $500 million.
POLAROID CORP: Former CEO Wants Sale Blocked, Seeks $7.2 Million
----------------------------------------------------------------
Bloomberg News reports that former Polaroid Corp. CEO Michael
O'Shaughnessy has asked the U.S. Bankruptcy Court for the District
of Minnesota to block the Company's sale unless it agrees to pay
him $7.2 million.
According to Bloomberg News, Mr. O'Shaughnessy resigned in 2007 to
work at Polaroid's parent company, Petters Group Worldwide LLC.
Mr. O'Shaughnessy claimed that Polaroid agreed to compensate him
if Polaroid were ever liquidated, court documents say.
As reported by the Troubled Company Reporter on January 30, 2009,
Polaroid Holding Company entered into a "stalking horse" Asset
Purchase Agreement with PHC Acquisitions, LLC, an affiliate of
Genii Capital. Under the terms of the agreement, PHC Acquisitions
would acquire certain of the Company's assets including, but not
limited to, all of Polaroid's intellectual property rights and the
"Polaroid" name and brand.
Bloomberg News relates that the agreed amount for the possible
sale was $42 million. Mr. O'Shaughnessy, according to the report,
wants the sale blocked unless the agreement includes his earnout
payment.
The "earnout payment may have been triggered" when Polaroid
allegedly signed over some assets to Ritchie Capital Management
LLC in 2008, before the Petters Group scandal broke, Mr.
O'Shaughnessy said in court documents. Bloomberg states that
Polaroid and Ritchie filed a lawsuit against each other in
bankruptcy court over the alleged transaction.
About Polaroid Corporation
Polaroid Corporation -- http://www.polaroid.com-- makes and
sells films, cameras, and other imaging products. The company and
20 of its affiliates first filed for bankruptcy protection on
October 12, 2001 (Bankr. D. Del. Lead Case No. 01-10864).
Skadden, Arps, Slate, Meagher & Flom LLP represented the Debtors
in their previous restructuring efforts. At that time, the
company blamed steep decline in its revenue and the resulting
impact on its liquidity.
On June 28, 2002, the U.S. Bankruptcy Court for the District of
Dealware approved the purchase of substantially all of Polaroid's
business by One Equity Partners. The bid provides for cash
consideration of $255 million plus a 35% interest in the new
company for unsecured creditors.
Polaroid Corp., together with 11 affiliates, filed its second
voluntary petition for Chapter 11 on Dec. 18, 2008 (Bankr. D.
Minn., Lead Case No. 08-46617). Judge Gregory F. Kishel handles
the Chapter 22 case. James A. Lodoen, Esq., at Lindquist & Vennum
P.L.L.P, is the Debtors' counsel.
According to the company, the financial structuring process and
the second bankruptcy filing are the result of events at Petters
Group Worldwide, which has owned Polaroid since 2005. The founder
of Petters Group and certain associates are currently under
investigation for alleged acts of fraud that have compromised the
financial condition of Polaroid and other entities owned by
Petters Group. The company and its leadership team are not
subjects of the ongoing investigation involving Petters Group.
QIMONDA AG: Deadline to Find Investors Moved; Liquidation Looming
-----------------------------------------------------------------
Court documents say that Qimonda AG has extended its March 31
deadline to find investors. The new deadline wasn't disclosed.
Emily C. Dooley at Richmond Times-Dispatch relates that Qimonda
will ramp down production at its Dresden, Germany, facility while
the search for investors continues.
Times-Dispatch quoted Michael Jaffe, a preliminary insolvency
administrator assigned to oversee Qimonda's operations, as saying,
"Various investors have signaled their interest, but as yet there
are no binding offers on the table."
Mark Lee Wai Yee and Frances Robinson at Bloomberg News relate
that Inspur International Ltd. said that it isn't interested in
acquiring a stake in Qimonda. Inspur Group Co., Inspur
International's parent, ended negotiations to acquire a stake in
Qimonda, Bloobmerg states, citing Inspur International
spokesperson Liu Xueheng. The report says that the talks ended
after Qimonda's insolvency filing. According to the report,
insolvency proceedings will start on April 1.
The Financial Times states that under a plan drafted by Mr. Jaffe,
Inspur International would acquire 50% of Qimonda to help the
Company exit bankruptcy, creditors would have 15%, and Portugal
and the German state of Saxony would take the remainder.
Qimonda faces liquidation if it fails to find investors, Times-
Dispatch states, citing Mr. Jaffe.
Qimonda AG (NYSE: QI) -- http://www.qimonda.com/-- is a leading
global memory supplier with a diversified DRAM product portfolio.
The company generated net sales of EUR1.79 billion in financial
year 2008 and had -- prior to its announcement of a repositioning
of its business -- approximately 12,200 employees worldwide, of
which 1,400 were in Munich, 3,200 in Dresden and 2,800 in Richmond
(Virginia, USA). The company provides DRAM products with a focus
on infrastructure and graphics applications, using its power
saving technologies and designs. Qimonda is an active innovator
and brings high performance, low power consumption and small chip
sizes to the market based on its breakthrough Buried Wordline
technology.
RAHMATOLLA MIZRAHI: Voluntary Chapter 11 Case Summary
-----------------------------------------------------
Debtor: Rahmatolla Mizrahi
97-34 64th Avenue
Rego Park, NY 11374
Bankruptcy Case No.: 09-41717
Type of Business: Rahmatolla Mizrahi owns real estate property.
Chapter 11 Petition Date: March 9, 2009
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Elizabeth S. Stong
Debtor's Counsel: Alan Levin, Esq.
26 Court Street
Suite #1907
Brooklyn, NY 11242
Tel: 718-522-1972
Total Assets: $1,786,950.00
Total Debts: $1,259,870.00
The Debtor did not file a list of 20 largest unsecured creditors
together with its petition.
The petition was signed by Rahmatolla Mizrahi.
RAILPOWER TECHNOLOGIES: Delays Filing of Financial Results
----------------------------------------------------------
Railpower Technologies Corp. has said the filing of its audited
financial statements, management's discussion and analysis and
related CEO and CFO certifications for the year ended December 31,
2008, will be delayed beyond the statutory deadline of March 31,
2009.
The Corporation and its U.S. subsidiary, Railpower Hybrid
Technologies Corp., have obtained an order from the Quebec
Superior Court providing Railpower with an additional period of
protection under the Companies' Creditors Arrangement Act (Canada)
until April 7, 2009, during which time creditors and other third
parties will continue to be stayed from taking steps against
Railpower. While under CCAA protection, Railpower's board of
directors maintains its usual role and its management remains
responsible for the day-to-day operations of Railpower, under the
supervision of the Court-appointed monitor, Ernst & Young Inc.
Since the focus of Railpower is currently on preserving cash
during the course of its restructuring process under the CCAA, it
was deemed in the best interests of the Corporation and its
stakeholders to delay the preparation and filing of the financial
statements and MD&A for the time being. The postponement will
also allow the Corporation's senior management to fully focus on
Railpower's restructuring process. The Corporation does not know
at this time when it would be in a position to prepare and file
its financial statements and MD&A, as such preparation and filing
will be driven by the outcome of its restructuring efforts.
Pending the filing of its financial statements and MD&A, the
Corporation intends to satisfy the alternative information
guidelines of National Policy 12-203 - Cease Trade Orders for
Continuous Disclosure Defaults. These guidelines require the
Corporation to file bi-weekly default status reports containing
any material changes, all actions taken by the Corporation to
remedy the default, particulars of any failure by the Corporation
to fulfill the provisions of the alternative information
guidelines, any subsequent defaults of the Corporation requiring a
default announcement and any other material information concerning
the affairs of the Corporation not previously disclosed. The
Corporation intends to issue the first default status report on
March 27, 2009.
The Corporation also intends to file with the securities
regulatory authorities throughout the period in which it is in
default, the same information it is required to provide to its
creditors, when the information is provided to such creditors and
in the same manner as it would file a material change report.
About Railpower Technologies
Brossard, Quebec-based Railpower Technologies Corp. (CA:P) -
http://www.railpower.com-- is engaged in the development,
construction, marketing and sales of high performance, clean
locomotives and power plants for the transportation and related
industries. Railpower has designed and is marketing a range of
locomotives for the North American low and medium horsepower
locomotive market. It has also designed and is marketing hybrid
power plants for rubber tyred gantry cranes (Eco-Cranes(R)). Its
technologies have broader potential and applications in other
markets and industries.
The Chapter 15 petition was filed on behalf of Railpower Hybrid
Technologies Corp., on February 5, 2009 (Bankr. W.D. Pa. Case No.
09-10198). The Hon. Warren W. Bentz presides over the case. The
Chapter 15 Petitioner is represented by Paul J. Cordaro, Esq., at
Campbell & Levine LLC, in Pittsburgh, Pennsylvania. Railpower
Hybrid estimated its assets to be between $1 million and
$10 million, and its debts to be between $100 million and
$500 million.
RETAIL PRO: Island Pacific Not Included in Bankruptcy Filing
------------------------------------------------------------
Retail Pro Inc.'s Chapter 11 bankruptcy filing doesn't include
Island Pacific, Alex Woodie at Itjungle.com reports, citing 3Q
Holdings Limited.
Island Pacific CEO Davy Rosen said in a statement, "We want to
reiterate that Island Pacific is a completely separate company
that is not affiliated with Retail Pro." Itjungle.com relates
that 3Q Holdings acquired Island Pacific from Retail Pro more than
a year ago.
According to Itjungle.com, Retail Pro used either the Island
Pacific name or the new Retail Pro name before the Company sold
the unit to 3Q Holdings for $16 million in December 2007.
Retail Pro had moved its headquarters south from Irvine,
California, to La Jolla, California, Itjungle.com states. From
then on the Company stopped using the Island Pacific name, says
the report.
Island Pacific is still based in Irvine and is alive and well,
Itjungle.com states, citing Mr. Rosen. "Island Pacific is an
ongoing and viable entity with a healthy sales pipeline and is
engaged in many projects throughout our customer base," the report
quoted Mr. Rosen as saying.
About Retail Pro
Based in La Jolla, California, Retail Pro Inc. --
http://www.retailpro.com-- operates a chain of retail stores.
The company and three of its affiliates filed for Chapter 11
protection on Jan. 10, 2009 (Bankr. D. Del. Lead Case No.
09-10087). Bruce Grohsgal, Esq., and Laura Davis Jones, Esq., at
Pachulski, Stang, Ziehl Young & Jones, represent the Debtors in
their restructuring efforts. The Debtor proposed View Partners
Capital LLC as their investment banker and Kurtzman Carson
Consultants LLC as their notice, claims and solicitation agent.
As of Nov. 30, 2008, the Debtors have $24,652,353 in total assets
and $28,867,462 in total debts.
SDM&C INVESTMENTS: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: SDM&C Investments, LLC
P.O. Box 531
Sante Fe, NM 87504
Bankruptcy Case No.: 09-11022
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Western District of Oklahoma (Oklahoma City)
Judge: Niles L. Jackson
Debtor's Counsel: O. Clifton Gooding, Esq.
The Gooding Law Firm
1200 City Place Building
204 N. Robinson Avenue
Oklahoma City, OK 73102
Tel: (405) 948-1978
Fax: (405) 948-0864
Email: cgooding@goodingfirm.com
Total Assets: $1,334,000.00
Total Debts: $522,866.02
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/okwb09-11022.pdf
The petition was signed by Hani Naser, Manager of the Company.
SCHAWK INC: Evaluates Compliance with Credit Facilities
-------------------------------------------------------
Schawk, Inc., disclosed that due to deteriorating economic
conditions experienced during the latter half of 2008, it is in
the process of determining the amount of certain impairments for
the fourth quarter of 2008 related to goodwill. Although
management is currently completing the valuations required to
determine the extent of the impairment charges, the Company
expects the total amount of the non-cash goodwill impairment
charges to be in the range of $20 million to $30 million for the
fourth quarter and full year of 2008. As the Company has not
completed its analysis of the impairment charges, the estimate is
preliminary based upon management's current expectations and is
subject to change.
Given the Company's current expectations as to its full-year 2008
operating results, Schawk is evaluating its compliance with the
financial covenants under its debt agreements. If the Company
determines it is not in compliance with such covenants, it would
seek any necessary waivers or amendments from its lenders.
Failure to obtain the waivers or amendments could result in a
default and related acceleration of the Company's debt and render
unavailable additional borrowings under the Company's credit
facility. Any of these events could have a material adverse
effect on the Company's business, financial condition and results
of operations. There can be no assurance that, if the Company
determines it is not in compliance with applicable covenants, it
will be able to obtain the necessary waivers or amendments on
commercially reasonable terms, or at all.
On Tuesday, Schawk said it will report net sales of approximately
$489.2 million for the year ended December 31, 2008, an
approximate 9.2% decrease in net sales relative to the comparable
prior-year period. After giving effect to the estimated goodwill
impairment charge, the Company expects to report a full-year
operating loss in the range of $30 million to $40 million versus
operating income of $60.5 million in the comparable prior-year
period. In addition, the Company expects to report that its
operating results for full-year 2008 were negatively impacted by
approximately $10.4 million of restructuring related charges,
$4.3 million of foreign currency transaction losses, $6.8 million
in increased professional and consulting fees related to the
Company's internal control remediation and related matters,
$7.3 million in multi-employer pension plan withdrawal expense,
and $6.6 million of impairment charges related to long-lived
assets. The total of these items is $35.4 million (of which
$8.3 million is non-cash) excluding the goodwill impairment
charges as described below. The Company is in the process of
finalizing its results for the year and quarter ended December 31,
2008, and therefore the above estimates are preliminary and
subject to change.
The Company is working diligently to finalize its results for the
quarter and year ended December 31, 2008, and will file its Form
10-K for the year ended December 31, 2008, as soon as its internal
review of its financial results and the audit by the Company's
external audit firm is complete.
Founded in 1953, Schawk, Inc., (SGK) -- http://www.schawk.com--
based in Des Plaines, Illinois, provides brand point management
services, enabling companies of all sizes to connect their brands
with consumers to create deeper brand affinity. With a global
footprint of more than 60 offices, Schawk helps companies create
compelling and consistent brand experiences by providing
integrated strategic, creative and executional services across
brand touchpoints.
SEQUA CORP: Moody's Junks Rating on Exposure to Airlines, Big 3
---------------------------------------------------------------
Moody's Investors Service has downgraded the Corporate Family and
the Probability of Default Rating of Sequa Corporation to Caa1
from B3. In a related action, the company's senior secured bank
credit facilities were downgraded to B2 from B1, and the company's
senior unsecured notes were affirmed at Caa2. The ratings are
placed on review for possible further downgrade.
The rating downgrades reflect the weak industry conditions for
Sequa's end markets and the resulting pressure being placed on its
highly levered capital structure. The company's three primary
operating segments all experienced substantial top line pressure
in the fourth quarter of 2008 and this trend is expected to
continue through at least most of 2009. Sequa's Chromalloy Gas
Turbine unit's exposure to commercial airlines is feeling the
impact of reduced global air miles flown, the automotive segment
is being affected by the substantial drop in new car production,
particularly at its primary customers, the Big 3 OEM's, and lastly
the metal coating business is down due to the slowdown in the non-
residential construction market. The company has already
significantly reduced headcount and closed facilities to attempt
to align its cost structure with the weak sales environment.
Moody's review for possible further downgrade will focus on
analysis of the adequacy of Sequa's restructuring efforts and on
its ability to maintain an adequate liquidity profile.
These ratings/assessments have been affected:
-- Corporate Family Rating downgraded to Caa1 from B3;
-- Probability of Default Rating downgraded to Caa1 from B3;
-- $150 million senior secured revolver due 2013 downgraded to
B2 (LGD2, 27%) from B1 (LGD3, 31%);
-- $1,200 million senior secured term loan due 2014 downgraded
to B2 (LGD2, 27%) from B1 (LGD3, 31%);
-- $500 million 11.75% senior unsecured notes due 2015 affirmed
at Caa2 (LGD5, 81%);
-- $211 million (orginial amt.) 13.5% senior unsecured discount
notes due 2015 affirmed at Caa2 (LGD5, 81%);
All ratings are placed on review for possible further downgrade.
The last rating action was on June 4, 2008, when Sequa's B3
Corporate Family Rating and stable outlook were affirmed.
Sequa Corporation, headquartered in New York, New York, is a
diversified industrial company. Its operations manufacture and
repair jet engine components, perform metal coating, produce
automotive airbag inflators, cigarette lighters, power outlets and
sensors, and emissions control systems. Annual revenues are
approximately $1.7 billion.
SIX FLAGS: To Offer Debt-Equity Exchange Out of Court or in Ch. 11
------------------------------------------------------------------
Six Flags Inc. Chief Financial Officer Jeffrey Speed says the
Company will offer debtholders equity in exchange for their debt
by the year's end, Bloomberg's Bill Rochelle said. According to
the report, the debt restructuring will be performed in in-court
or out-of-court.
Mr. Speed said the Company has no plans to sell any of its
properties.
As reported by the TCR on March 13, Six Flags has disclosed that
its Preferred Income Equity Redeemable Shares are required to be
redeemed on August 15, 2009, at which time the Company will be
required to redeem all of the PIERS for cash at 100% of the
liquidation preference -- $287.5 million -- plus accrued and
unpaid dividends -- $31.3 million assuming dividends are accrued
and not paid through the mandatory redemption date. The company
does not expect to have sufficient cash to redeem the PIERS at
their redemption date.
Given the current negative conditions in the economy generally and
the credit markets in particular, Six Flags said there is
substantial uncertainty that it will be able to effect a
refinancing of its debt on or prior to maturity or the PIERS prior
to their mandatory redemption date on August 15, 2009.
"As a result of these factors, there is substantial doubt about
our ability to continue as a going concern unless a successful
restructuring occurs," Six Flags said.
Six Flags said the PIERS redemption is just one component of the
comprehensive restructuring of the balance sheet that the company
is pursuing.
Annual maturities of Six Flags' long-term debt during the next
five years -- assuming maturity of the term loan portion of the
Credit Facility is not accelerated -- are:
2009 $253,970,000
2010 140,931,000
2011 9,388,000
2012 8,628,000
2013 150,941,000
Thereafter 1,802,384,000
--------------
$2,366,242,000
According to Six Flags, if it is unable to refinance or
restructure the PIERS at or prior to the mandatory redemption
date, the failure would constitute a default under its amended and
restated credit facility, which would permit the lenders to
accelerate the obligations. A cross-default would also be
triggered under Six Flags' public debt indentures, which would
likely result in most or all of its long-term debt becoming due
and payable. In that event, Six Flags would be unable to fund
these obligations. Six Flags said such a circumstance could have
a material adverse effect on its operations and the interests of
its creditors and stockholders.
"We are exploring a number of alternatives for the refinancing of
our indebtedness and the PIERS, including a restructuring either
in or out-of-court. We believe the consummation of a successful
restructuring is critical to our continued viability. Any
restructuring will likely be subject to a number of conditions,
many of which will be outside of our control, including the
agreement of our PIERS holders, common stockholders, creditors and
other parties, and may limit our ability to utilize our net
operating loss carry forwards if there is an ownership change,
which is likely," Six Flags said.
"We can make no assurances that any restructuring that we pursue
will be successful, or what the terms thereof would be or what, if
anything, our existing debt and equity holders would receive in
any restructuring, which will depend on our enterprise value,
although we believe that any restructuring would be highly
dilutive to our existing equity holders and certain debt holders.
In addition, we can make no assurances with respect to what the
value of our debt and equity will be following the consummation of
any restructuring."
Six Flags said it may be compelled to seek an in-court solution in
the form of a pre-packaged or pre-arranged filing under the United
States Bankruptcy Code, if the company is unable to successfully
negotiate a timely out-of-court restructuring agreement with its
PIERS holders, common stockholders and creditors. Six Flags said
a bankruptcy filing would likely occur prior to the maturity of
the PIERS or well in advance of that date, if the company
concludes at such time that an out-of-court solution is not
feasible or advantageous.
About Six Flags
Headquartered in New York City, Six Flags Inc. (NYSE: SIX) --
http://www.sixflags.com/-- is the world's largest regional
theme park company with 21 parks across the United States, Mexico
and Canada. Founded in 1961, Six Flags has provided world class
entertainment for millions of families with cutting edge, record-
shattering roller coasters and appointment programming with events
like the popular Thursday and Sunday Night Concert Series. Now 47
years strong, Six Flags is recognized as the preeminent thrill
innovator while reaching to all demographics -- families, teens,
tweens and thrill seekers alike -- with themed attractions based
on the Looney Tunes characters, the Justice League of America,
skateboarding legend Tony Hawk, The Wiggles and Thomas the Tank
Engine.
* * *
According to the Troubled Company Reporter on March 13, 2009,
Six Flags said it does not have sufficient cash to redeem
$287.5 million in Preferred Income Equity Redeemable Shares on
August 15, 2009.
As of December 31, 2008, Six Flags had $3.03 billion in total
assets, including $210.3 million in cash and cash equivalents;
$2.11 billion in total long-term debt, and $2.36 billion in total
debt, excluding $123.1 million in debt at December 31, 2004,
which had been called for prepayment; and $443.8 million in
stockholders' deficit.
Given the current negative conditions in the economy generally and
the credit markets in particular, Six Flags said there is
substantial uncertainty that it will be able to effect a
refinancing of its debt on or prior to maturity or the PIERS prior
to their mandatory redemption date on August 15, 2009.
"As a result of these factors, there is substantial doubt about
our ability to continue as a going concern unless a successful
restructuring occurs," Six Flags said.
Six Flags Inc., has reportedly hired Paul Hastings Janofsky &
Walker as bankruptcy counsel and investment bank Houlihan Lokey
Howard & Zukin to negotiate with creditors, including its banks,
bondholders, and preferred shareholders.
As reported by the Troubled Company Reporter on March 3, 2009,
Fitch Ratings has downgraded Six Flags, Inc. and its subsidiaries
-- Six Flags (Issuer Default Rating to 'CC' from 'CCC'; and Senior
unsecured notes, including the 4.5% convertible notes, to 'C/RR6'
from 'CC/RR6'); Six Flags Operations Inc. (IDR to 'CC' from 'CCC';
and Senior unsecured notes to 'C/RR6' from 'CCC-/RR5'); and Six
Flags Theme Park Inc. (IDR to 'CC' from 'CCC'; and Secured bank
credit facility to 'B-/RR2' from 'B/RR1'). In addition, Fitch
affirms Six Flags' preferred stock at 'C/RR6'.
SIX FLAGS: Fitch Downgrades Issuer Default Rating to 'C'
--------------------------------------------------------
Fitch Ratings has taken these rating actions on Six Flags, Inc.
and its subsidiaries:
Six Flags
-- Issuer Default Rating downgraded to 'C' from 'CC';
-- Senior unsecured notes (including the 4.5% convertible notes)
affirmed at 'C/RR6';
-- Preferred stock affirmed at 'C/RR6'.
Six Flags Operations Inc.
-- IDR downgraded to 'C' from 'CC';
-- Senior unsecured notes affirmed at 'C/RR6'.
Six Flags Theme Park Inc.
-- IDR downgraded to 'C' from 'CC';
-- Secured bank credit facility downgraded to 'CCC/RR2' from 'B-
/RR2'.
Ratings in the 'C' category have exceptionally high levels of
credit risk. The ratings reflect Fitch's belief that that default
is imminent or inevitable. 'C' is the lowest rating category
before default.
Six Flags has made public that it has engaged financial advisors
and bankruptcy legal council to assist in its negotiations with
the company's lenders. In addition, the company has made public
statements that it expects to complete a comprehensive
restructuring of the balance sheet within the year, whether in or
out of bankruptcy. Fitch believes that some form of default is
inevitable whether it is a series of coercive debt exchanges, an
out-of-court deal, a pre-packaged bankruptcy or other proceeding
within the bankruptcy court.
Six Flags does not generate sufficient internal cashflow to repay
its mandatorily convertible preferred stock maturity, and given
the state of the credit markets and current pricing on Six Flags
securities, Fitch believes securing traditional external financing
would be extremely challenging. A failure to redeem the PIERs
when due would trigger a default on the bank credit facility.
Further, a default on the senior unsecured notes could be
triggered if the banks do not agree to grant an amendment or
waiver and choose to accelerate under the bank credit agreement.
Fitch has also further lowered the distressed EBITDA multiple used
in its analysis from 5.5 times (x) to 5.0x. The multiple reflects
estimated contraction in market multiples and the limited number
of strategic, well capitalized, buyers for theme park assets. The
'RR2' rating for the company's secured bank credit facility
reflects Fitch's belief that 71%-90% recovery is realistic given
its priority position in the capital structure. The 'RR6'
recovery rating for the Six Flags' and SFO's senior unsecured debt
and Six Flags' PIERs reflect 0% expected recovery.
As of Dec. 31, 2008, total debt of $2.7 billion was made up of
$1.3 billion in senior unsecured notes ($400 million at SFO),
$1.1 billion in bank debt ($837 million in term loan B and $244
million in revolver borrowings) and approximately $300 million in
PIERs. As of Dec. 31, 2008, the company's leverage of 10.0x, was
an improvement over 2007 year end leverage of 13.8x. For the
purpose of calculating leverage, Fitch has not included the
$435 million in liability that is attributed to the Partnership
Parks' limited partners equity put option that requires Six Flags
to purchase a percentage of their ownership interest. If the
leverage ratio is adjusted to include both the minority interest
EBITDA and partnership put liability, leverage would be
approximately the same.
Liquidity as of Dec. 31, 2008 consisted of $210.3 million in cash.
In October 2008, the company borrowed $244 million from its
revolving credit facility (there was a $0 balance as of Sept. 30,
2008) in order to ensure sufficient liquidity for its off-season.
In addition to its August 2009 PIERs maturity, Six Flags has
approximately $130 million in notes due in February 2010. Fitch
expects that Six Flag's liquidity should be sufficient to cover
operating costs in the off-season and invest in its parks.
While 2008 was a solid year for regional theme parks despite some
economic weakness and high energy prices, Fitch expects the 2009
season to be a challenging year as pressure on discretionary
consumer spending patterns could result in weaker attendance and
reduced in-park spending.
SPANSION INC: Delays Filing of Annual Report With SEC
-----------------------------------------------------
Spansion Inc., notified the U.S. Securities and Exchange Commission on
March 13, 2009, that it
could not file within the prescribed time period, its annual report on
Form 10-K for the fiscal year
ended December 28, 2008.
Dario Sacomani, executive vice president and chief financial
officer of Spansion Inc., informed the Commission that in the
months leading up to and since the Petition Date, the Company has
been principally engaged in addressing bankruptcy-related
matters, negotiating with creditors and potential strategic
partners, and reformulating its business strategy in an effort to
emerge from bankruptcy. Mr. Sacomani said that the Company's
financial, accounting and administrative personnel have devoted
substantially all of their time to the maintenance of the
Company's ongoing operations, including the development and
implementation of the Company's postpetition business strategy.
Thus, the Company's ability to address all of these matters
concurrently has been adversely affected by a substantial
reduction in force recently executed by the Company, Mr. Sacomani
explained.
According to Mr. Sacomani, the Bankruptcy filing came at a time
during which year-end audit procedures would normally be
conducted. As a result of the increased burdens placed upon the
Company's financial, accounting and administrative staff, the
diversion of the Company's financial resources towards the
restructuring efforts and the timing of the Company's long-lived
asset impairment testing, the Company has been unable to timely
complete its annual financial reporting process for the fiscal
year ended December 28, 2008, he added.
However, Mr. Sacomani assured the Court that the Company intends
to file its annual report on Form 10-K as soon as practicably
possible after completion of its financial reporting process.
About Spansion
Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a
Flash memory solutions provider, dedicated to enabling, storing
and protecting digital content in wireless, automotive, networking and
consumer electronics
applications. Spansion, previously a joint venture of AMD and Fujitsu,
is the largest company in
the world dedicated exclusively to designing, developing,
manufacturing, marketing, selling and
licensing Flash memory solutions.
Spansion Inc. and four affiliates filed voluntary petitions for
Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-
10690). Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and
Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel.
Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware
counsel. Epiq Bankruptcy
Solutions LLC, is the claims agent. As of Sept. 30, 2008, Spansion
disclosed total assets of
$3,840,000,000, and total debts of $2,398,000,000.
SPANSION INC: Seeks to Hire KPMG As Financial Advisors
------------------------------------------------------
Spansion Inc. and its affiliates seek permission from the U.s.
Bankruptcy Court for the District of
Delaware to employ KPMG, LLP as their financial advisors, nunc pro
tunc to the Petition Date,
pursuant to Sections 327(a) and 328(a) of the Bankruptcy Code.
In light of the size and complexity of the Debtors' Chapter 11
cases, they require the services of seasoned and experienced
financial advisors, tax advisors and accountants that are
familiar with their business, operations, accounting and finance
systems and the Chapter 11 process, Dario Sacomani, executive
vice president and chief financial officer of Spansion, Inc.,
tells the Court. According to Mr. Sacomani, the Debtors have
selected KPMG because:
(a) it has substantial experience working with financially
distressed and troubled companies in complex restructuring
and have provided financial advisory services in large and
complex Chapter 11 cases;
(b) it has developed a great deal of institutional knowledge
regarding the Debtors' corporate structure, businesses,
operations, finances and systems that the Debtors believe
will be valuable in their efforts to reorganized; and
(c) it has provided various tax and transactional services
to the Debtors over the past three years and has
demonstrated the ability to represent the Debtors in a
cost-effective, efficient and timely manner.
At the Debtors' request and direction, KPMG will:
1. advise and assist the Debtors in the compilation and
preparation of financial information necessary due to the
requirements of the Court or Office of the US Trustee as
well as financial information for distribution to creditors
and others;
2. assist the Debtors' personnel and other professionals
retained by the Debtors with communications and
negotiations with lenders, creditors, and other parties-in
-interest including the preparation of financial
information for distribution to parties-in-interest;
3. advise and assist the Debtors and other professionals
retained by the Debtors in the development, negotiation,
and execution of possible reorganization scenarios, Section
363 of the Bankruptcy Code sales or other potential sales
of assets or business units;
4. advise and assist the Debtors on cash conservation measures
and assist with the implementation of cash forecasting and
reporting tools;
5. assist the Debtors in the preparation of financial relate
disclosures required by the Court including the Schedules
of Assets and Liabilities, the Statement of Financial
Affairs and Monthly Operating Reports;
6. assist the Debtors in managing and executing the
reconciliation process involving claims filed by all
creditors;
7. assist the Debtors in identifying and reviewing preference
payments, fraudulent conveyances and other causes of
action;
8. assist the Debtors in responding to and tracking
reclamation and claims under Section 503(b)(9) of the
Bankruptcy Code;
9. assist with other accounting advisory services as requested
by the Debtors consistent with the roll of financial
advisor and not duplicative of services provided by other
professionals.
The Debtors propose to pay KPMG based on the firm's negotiated
hourly rates to reflect the complexity of task and the necessary
expertise to deliver the work:
Negotiated
Professional Hourly Rate
------------ -----------
Partner/Managing Director $575-$625
Director $470-$570
Manager $425-$475
Senior Associate $325
Associate $225
Intern/Para-Professional $100
The Debtors will also reimburse KPMG for necessary out-of-pocket
expenses incurred, including airfare, travel, meals and
accommodations.
Mr. Sacomani relates that the Debtors have paid KPMG a retainer
of $300,000 on January 16, 2009, and an additional $700,000 on
February 5. As of the Petition Date, there was an unused
retainer balance of approximately $800,000, which amount will be
applied in the final fee application against payment for services
rendered, disbursements made, and expenses incurred, Mr. Sacomani
adds. In addition, the Debtors paid KPMG $926,979 related to its
engagement on January 12, 2009, Mr. Sacomani tells the Court.
During the 90 days before the Petition Date, the Debtors note,
they have paid KPMG a total of $180,237 for other professional
services and reimbursement of expenses.
Mr. Sacomani says that KPMG will not be entitled to
indemnification, contribution or reimbursement for services other
than those described in the Engagement Letters, unless that
services and indemnification are approved by the Court. He
relates that the Debtors will have no obligation to indemnify, or
provide contribution or reimbursement to KPMG, for any claim or
expense that is either:
(i) judicially determined to have arisen from KPMG's bad
faith, self-dealing, breach of fiduciary duty, gross
negligence or willful misconduct; or
(ii) judicially determined, based on a breach of KPMG's
contractual obligations to the Debtors; or
(iii) settled prior to a judicial determination as the to the
exclusions, but determined by the Court, after notice and
a hearing, to be a claim or expense for which KPMG should
not receive indemnity, contribution or reimbursement under
the terms of its employment by the Debtors pursuant to the
terms of the Engagement Letter.
William A. Haegele, a partner at KPMG LLP, assures the Court that
his firm is a "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code, as modified by Section
1107(b).
About Spansion
Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a
Flash memory solutions provider, dedicated to enabling, storing
and protecting digital content in wireless, automotive, networking and
consumer electronics
applications. Spansion, previously a joint venture of AMD and Fujitsu,
is the largest company in
the world dedicated exclusively to designing, developing,
manufacturing, marketing, selling and
licensing Flash memory solutions.
Spansion Inc. and four affiliates filed voluntary petitions for
Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-
10690). Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and
Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel.
Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware
counsel. Epiq Bankruptcy
Solutions LLC, is the claims agent. As of Sept. 30, 2008, Spansion
disclosed total assets of
$3,840,000,000, and total debts of $2,398,000,000.
SPANSION INC: U.S. Trustee Appoints Unsecured Creditors Committee
-----------------------------------------------------------------
Roberta A. DeAngelis, acting United States Trustee for Region 3,
appoints five members to the
Official Committee of Unsecured
Creditors in the Chapter 11 cases of Spansion Inc., and its four
debtor affiliates:
1. U.S. Bank National Association
Attn: James E. Murphy
100 Wall Street, Suite 1600
New York, NY 10005
Phone: 212-361-6174
2. Wilmington Trust Company
Attn: Steven Cimalore
1100 N. Market St.
Wilmington, DE 19890,
Phone: 302-651-8681
Fax: 302-651-8882
3. ChipMOS Technologies (Bermuda) Ltd.
Attn: Joseph E. Schoenholtz Jr.
2890 N. First St., San Jose, CA 95134
Phone: 408-922-2777 ext 2242
Fax: 408-922-7276
4. Tokyo Electron Limited
Attn: Zoltan A. Papp
2400 Grove Blvd.
Austin, TX 78741
Phone: 512-656-8651
Fax: 512-424-1534
5. TSMC North America
Attn: Naomi Obinata
2585 Junction Avenue
San Jose, CA 95134
Phone: 408-382-7981
Fax: 408-382-8008
About Spansion
Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a
Flash memory solutions provider, dedicated to enabling, storing
and protecting digital content in wireless, automotive, networking and
consumer electronics
applications. Spansion, previously a joint venture of AMD and Fujitsu,
is the largest company in
the world dedicated exclusively to designing, developing,
manufacturing, marketing, selling and
licensing Flash memory solutions.
Spansion Inc. and four affiliates filed voluntary petitions for
Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-
10690). Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and
Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped as
bankruptcy counsel.
Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delaware
counsel. Epiq Bankruptcy
Solutions LLC, is the claims agent. As of Sept. 30, 2008, Spansion
disclosed total assets of
$3,840,000,000, and total debts of $2,398,000,000.
SPANSION INC: Appoints Brincko as Chief Restructuring Officer
-------------------------------------------------------------
Spansion Inc. has retained John P. Brincko as Chief Restructuring
Officer (CRO). Brincko's firm, Brincko Associates, Inc., has been
listed as one of the "Outstanding Turnaround Firms" for ten of the
past ten years by Turnarounds and Workouts, a leading publication
dedicated to restructuring.
As CRO, Brincko will oversee negotiations with Spansion's
creditors, including debt-holders, to restructure the company's
approximately $1.5 billion in secured and unsecured debt.
"The decision to retain John is one more indication of how
committed we are to creating a more manageable debt structure so
that we can focus on building a sustainable and profitable
business," said Spansion President and CEO John Kispert. "John has
a tremendous track record and we are expecting him to play a key
role in revitalizing Spansion."
Mr. Brincko has more than 35 years of executive, financial and
operational management experience. His major assignments have
included: CEO of CalComp Technology (Lockheed Martin publicly held
subsidiary); president and COO of Barneys New York; CEO of
Mossimo, Inc.; CEO of Knudsen Foods, Inc. and Foremost Dairies;
CEO of Consolidated Freightways; CEO of Strouds, Sun World
International, Inc., Globe Security, PCL Industries, Ltd.; and CRO
of Franchise Pictures, VANS and many others.
Mr. Brincko has also held executive management positions with Max
Factor, American Home Products, International Paper Company, Peat,
Marwick, Mitchell and Grey Advertising.
About Spansion
Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a
Flash memory solutions provider, dedicated to enabling, storing
and protecting digital content in wireless, automotive, networking
and consumer electronics applications. Spansion, previously a
joint venture of AMD and Fujitsu, is the largest company in the
world dedicated exclusively to designing, developing,
manufacturing, marketing, selling and licensing Flash memory
solutions.
Spansion Inc. and four affiliates filed voluntary petitions for
Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-
10690). Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and
Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped
as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane
Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions
LLC, is the claims agent. As of Sept. 30, 2008, Spansion
disclosed total assets of $3,840,000,000, and total debts of
$2,398,000,000.
SPANSION INC: Retains John Brincko as Chief Restructuring Officer
-----------------------------------------------------------------
Spansion Inc. has retained John P. Brincko as Chief Restructuring
Officer (CRO). Mr. Brincko's firm, Brincko Associates, Inc., has
been listed as one of the "Outstanding Turnaround Firms" for ten
of the past ten years by Turnarounds and Workouts, a leading
publication dedicated to restructuring.
As CRO, Mr. Brincko will oversee negotiations with Spansion's
creditors, including debt-holders, to restructure the company's
approximately $1.5 billion in secured and unsecured debt. On
March 1, 2009, Spansion voluntarily filed for reorganization under
chapter 11 of the U.S. Bankruptcy Code to strengthen its capital
structure and focus its business for long-term success.
"The decision to retain John is one more indication of how
committed we are to creating a more manageable debt structure so
that we can focus on building a sustainable and profitable
business," said Spansion President and CEO John Kispert. "John
has a tremendous track record and we are expecting him to play a
key role in revitalizing Spansion."
Mr. Brincko has more than 35 years of executive, financial and
operational management experience. His major assignments have
included:
-- CEO of CalComp Technology (Lockheed Martin publicly held
subsidiary);
-- president and COO of Barneys New York;
-- CEO of Mossimo, Inc.;
-- CEO of Knudsen Foods, Inc. and Foremost Dairies;
-- CEO of Consolidated Freightways;
-- CEO of Strouds, Sun World International, Inc., Globe
Security, PCL Industries, Ltd.; and
-- CRO of Franchise Pictures, VANS and many others.
Mr. Brincko has also held executive management positions with Max
Factor, American Home Products, International Paper Company, Peat,
Marwick, Mitchell and Grey Advertising.
About Spansion
Spansion Inc. (NASDAQ: SPSN) -- http://www.spansion.com-- is a
Flash memory solutions provider, dedicated to enabling, storing
and protecting digital content in wireless, automotive, networking
and consumer electronics applications. Spansion, previously a
joint venture of AMD and Fujitsu, is the largest company in the
world dedicated exclusively to designing, developing,
manufacturing, marketing, selling and licensing Flash memory
solutions.
Spansion Inc. and four affiliates filed voluntary petitions for
Chapter 11 on March 1, 2009 (Bankr. D. Del. Lead Case No. 09-
10690). Michael S. Lurey, Esq., Gregory O. Lunt, Esq., and
Kimberly A. Posin, Esq., at Latham & Watkins LLP, have been tapped
as bankruptcy counsel. Michael R. Lastowski, Esq., at Duane
Morris LLP, is the Delaware counsel. Epiq Bankruptcy Solutions
LLC, is the claims agent. As of Sept. 30, 2008, Spansion
disclosed total assets of $3,840,000,000, and total debts of
$2,398,000,000.
ST. LAWRENCE HOMES: Seeks to Sell Homes in the Ordinary Course
--------------------------------------------------------------
To provide comfort for nervous buyers, St. Lawrence Homes asks the
U.S. Bankruptcy Court for the Eastern District of California to
give it blanket authorization to sell a home free of mortgages so
long as no secured creditor objects, even though the lienholder
may not be paid in full, Bloomberg News reports.
Selling assets, under Section 363 of the Bankruptcy Code,
typically requires approval by the bankruptcy court. According to
Bloomberg's Bill Rochelle, St. Lawrence Homes believes that
selling homes is the ordinary course of business not requiring
bankruptcy court authorization.
St. Lawrence Homes in February filed its formal lists of assets
and debt showing property on the books for $158.2 million against
liabilities totaling $115.9 million, including $107.7 million in
secured claims. Nearly all of the property value is in real
estate.
St. Lawrence Homes, Inc. -- http://www.stlh.com/-- is a North
Carolina based homebuilder with additional operations in Ohio.
Founded in 1987 St. Lawrence Homes has received accolades for
quality, design and has been recognized as one of the largest
privately held builders in the country. For more information
please contact 919-676-8980, ext. 114.
It filed for Chapter 11 on Feb. 2 (Bankr. E.D. N.C., Case No. 09-
00775). The Company, in its bankruptcy petition, listed assets of
$158.2 million against debt totaling $116.4 million as of Oct. 31.
ST. MARY'S HOSPITAL: Can Access $600,000 of HF-4 Cash Collateral
---------------------------------------------------------------
St. Mary's Hospital, Passaic, N.J., obtained interim authority
from the U.S. Bankruptcy Court for the District of New Jersey, to
access cash collateral securing repayment of loan and security
agreement dated as of Feb. 27, 2007, to HFG Healthco-4 LLC and
Healtcare Finance Group, Inc.
The Debtor is authorized to use in the ordinary course of its
business the cash collateral in an amount not to exceed $600,000.
HF-4 is the Debtor's existing lender. As of the petition date,
HF-4 and HFG are owed approximately $9,000,000 on account of the
revolving loan. As of the petition date, there are approximately
$18,000,000 in uncollected prepetition receivables and other
anticipated receipts subject to HF-4 and HFG's lien.
The Debtor was able to obtain more favorable credit terms than
would have been the case if a new lender had stepped in to make a
new loan.
DIP Loan Facility with HF-4
Under the postpetition financing, The Debtor will obtain from
HF-4, as revolving lender and revolving agent, and HFG, as
administrative agent, cash advances and other extensions of credit
in an aggregate principal amount of up to $20,000,000 on a
revolving credit basis.
The proceeds of the borrowings will be used by the Debtor to: (a)
repay the revolving loan prepetition debt; (b) fund ongoing
working capital and general corporate needs during the Chapter 11
case; (c) pay the fees, costs, expenses and disbursement of
professionals retained by the Debtor and any statutory committees
appointed in the Chapter 11 case; (d) pay the costs and expenses
of members of the committees; and (e) other bankruptcy-related
costs; and (f) pay the fees and expenses owed to the lender
parties under the DIP agreements, instruments, and other documents
executed in connection therewith.
The postpetition financing will operate in two stages: first,
under the interim facility, the initial loans and advances will be
limited to revolving advances in amounts not to exceed a maximum
outstanding principal amount of $9.75 million, which amount
includes the assumption of the revolving loan prepetition debt.
Upon the approval at the final hearing to consider this motion,
any remaining availability under the postpetition financing will
become available for the Debtor's use.
The maturity date for the DIP agreement will be 9 months after the
petition date.
The interest rate on the DIP agreement will be the same as the one
charged prepetition by the lender. 30-day LIBOR, subject to a
3.0% floor), plus 10.5% per annum.
Notwithstanding the granting of the liens, the adequate protection
liens, and the superpriority claims, the Carve-Out will have
priority in payment over the liens and claims that all proceeds
received by the lender parties or a party receiving adequate
protection will be subject to the prior payment of the Crave-out.
As adequate protection, HF-4 and HFG will be granted a
postpetition, valid, perfected, replacement lien and security
interests in all of the Debtor's account receivables to the extent
the Debtor's use of cash collateral diminishes HF-4's and HFG's
interest in the collateral. Additionally, HF-4 and HFG will also
be granter a claim entitiled to priority in an amount equal to
diminution of HF-4's and HFG's interest in the cash collateral
resulting from the Debtor's use therof.
About St. Mary's Hospital, Passaic, N.J.
St. Mary's Hospital, Passaic, N.J., filed for Chapter 11
protection on March 9, 2009 (Bankr. D. N.J. Case No. 09-15619).
Joseph Lubertazzi, Jr., Esq., at McCarter & English assists the
hospital in its restructuring effort. St. Mary's listed assets of
$70.8 million and debts of $128 million.
ST. MARY'S HOSPITAL: Wants to Hire Donlin Recano. as Claims Agent
-----------------------------------------------------------------
St. Mary's Hospital, Passaic, N.J., seeks authority from the U.S.
Bankruptcy Court for the District of New Jersey to employ Donlin
Recano & Company, Inc. as claims and noticing agent.
Donlin will:
a) serve as the Court's noticing agent to mail notices to
certain of the estate's creditors and other parties in
interest; and
b) provide expertise, consultation, and assistance in claim
and ballot processing, well as with the dissemination of
other administrative information related to the Debtor's
Chapter 11 case, including (i) the preparation of the
Debtor's schedules and statements of financial affairs, and
master creditor lists, and any amendments thereto, if
necessary; (ii) the reconciliation and resolution of
claims; and (iii) the preparation, mailing and tabulation
of ballots of certain creditors for the purpose of voting
on a Plan or Plans of Reorganization.
The Debtor proposes that the fees and expenses of Donlin incurred
in the performance of the services be treated as an administrative
expense, without the need to file any fee applications.
Colleen A. McCormick, chief operating officer of Donlin, assures
the Court that Donlin is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code.
About St. Mary's Hospital, Passaic, N.J.
St. Mary's Hospital, Passaic, N.J., filed for Chapter 11
protection on March 9, 2009 (Bankr. D. N.J. Case No. 09-15619).
Joseph Lubertazzi, Jr., Esq., at McCarter & English assists the
hospital in its restructuring effort. St. Mary's listed assets of
$70.8 million and debts of $128 million.
ST. MARY'S HOSPITAL: Wants McCarter & English as Bankr. Counsel
---------------------------------------------------------------
St. Mary's Hospital, Passaic, N.J., seeks authority from the U.S.
Bankruptcy Court for the District of New Jersey to employ McCarter
& English, LLP as counsel.
McCarter & English will:
a) advise the Debtor of its powers and duties as debtor in
possession in the continued operation of its business and
management of its properties;
b) assist, advise and represent the Debtor in its
consultations with creditors regarding the administration
of this case;
c) provide assistance, advice and representation concerning
the preparation and negotiation of a Plan or Reorganization
and disclosure statement and any asset sales, equity
investments or other transactions proposed in connection
with this Chapter 11 case;
d) provide assistance, advice and representation concerning
any investigation of the assets, liabilities and financial
condition of the Debtor that may be required;
e) represent the Debtor at hearings on matters pertaining to
its affairs as debtor in possession;
f) prosecute and defend litigation matters and other matters
that might arise during and related to the Chapter 11 case,
except to the extent that the Debtor has employed or
hereafter seeks to employ special conflicts counsel;
g) provide counseling and representation with respect to the
assumption or rejection of executory contracts and leases
and other bankruptcy-related matters arising from this
case;
h) take necessary action to protect and preserve the Debtor's
estate, including the prosecution of actions on behalf of
the Debtor, the defense of any actions commenced against
the Debtor as to which the automatic stay does not apply,
other than actions defended in the ordinary course of
business and objection to claims filed against the Debtor's
estates; and
i) perform other legal services as may be necessary and
appropriate for the efficient and economical administration
of this Chapter 11 case.
The Debtor proposes to pay McCarter & English's professionals
based upon the firm's normal hourly billing rate. The court
document did not disclose the specific hourly rates of the
professionals.
McCarter & English has received a $204,647 retainer for its
engagement prepetition. The sum will be held in a McCarter &
English Trust Account as a postpetition advance payment to be
applied against any unpaid fees and expenses.
To the best of the Debtor's knowledge, McCarter & English is a
"disinterested person" as that term is defined in Section 101 (14)
of the Bankruptcy Code.
McCarter & English can be reached at:
Four Gateway Center
100 Mulberry Street
Newark, NJ 07102
Tel: (973) 622-4444
Fax: (973) 624-7070
About St. Mary's Hospital, Passaic, N.J.
St. Mary's Hospital, Passaic, N.J., filed for Chapter 11
protection on March 9, 2009 (Bankr. D. N.J. Case No. 09-15619).
St. Mary's listed assets of $70.8 million and debts of
$128 million.
STAR TRIBUNE: Reaches Settlement with Pressmen's Union
------------------------------------------------------
Minneapolis Star Tribune has submitted documents with the U.S.
Bankruptcy Court for the Southern District of New York documents
seeking to reject its collective bargaining agreement with its
pressmen's union, in the event it fails to obtain voluntary
concessions from the union.
The Court has begun the process for considering the proposed
contract rejection. The Debtor and the union, however, reached an
agreement on March 13, Bloomberg's Bill Rochelle said.
The terms of the settlement were not disclosed, pending
ratification by union members. According to Mr. Rochelle, if the
new contract is not ratified, the Court will hear closing
arguments on the rejection motion.
The Company's three other unions have earlier agreed to
concessions.
According to Bloomberg, Chief Financial Officer David Montgomery
told the Court that Star Tribune's revenue was down 30% in January
and February compared with a year ago, making its need to reject a
union contract more urgent.
About Star Tribune
Headquartered in Minneapolis, Minnesota, The Star Tribune Company
-- http://www.startribune.com-- operate the largest newspaper in
the U.S. state of Minnesota and published seven days each week in
an edition for the Minneapolis-Saint Paul metropolitan area. The
company and its affiliate, Star Tribune Holdings Corporation,
filed for Chapter 11 protection on January 15, 2009 (Bankr. S.D.
N.Y. Lead Case No. 09-10245). Marshall Scott Huebner, Esq., at
Davis Polk & Wardwell, represents the Debtors in their
restructuring efforts. The Debtors proposed Blackstone Group LP
as their financial advisor; and Curtis, Mallet-Prevost, Colt &
Mosle LLP as conflict counsel; and Garden City Group Inc. as
claims agent. When the Debtors filed for protection from their
creditors, they listed assets and debts between $100 million to
$500 million each.
STRUCTURAL INVESTMENTS: Involuntary Chapter 11 Case Summary
-----------------------------------------------------------
Alleged Debtor: Structural Investments & Planning XII, L.L.C.
5125 E. Thomas Road
Phoenix, AZ 85016
Case Number: 09-04345
Involuntary Petition Date: March 11, 2009
Court: District of Arizona (Phoenix)
Judge: James M. Marlar
Petitioners Nature of Claim Claim Amount
----------- --------------- ------------
Peter Workum loan $15,000
4301 N 21st St. #42
Phoenix, AZ 85016
Greg Harrington loan $15,000
2210 Blake St. Lot 303
Denver, CO 80204
Bill Collamer commission $5,000
5122 N 31st Way
Phoenix, AZ 85016
S&K FAMOUS: Liquidator to Conduct GOB Sales at 30 of 136 Stores
---------------------------------------------------------------
S&K Famous Brands Inc. is closing 30 of 136 stores. According to
Bloomberg's Bill Rochelle, a liquidator will conduct going-out-of-
business sales at those 30 stores.
Mr. Rochelle notes that the Company had already shut 78 stores
pre-bankruptcy.
S&K Famous has obtained interim approval from the U.S. Bankruptcy
Court for the Eastern District of Virginia to access a senior
secured, super-priority revolving credit facility of $13 million.
The DIP Facility is governed by the Debtor-In-Possession Credit
Agreement dated as of Feb. 9, 2009, between the Debtor as borrower
and Wells Fargo Retail Finance, LLC, as Agent, and the lenders
party thereto.
About S&K Famous Brands, Inc.
Headquartered in Glen Allen, Virginia, S & K Famous Brands, Inc. -
- http://www.skmenswear.com/-- sells men's swimwear. The Debtor
filed for Chapter 11 protection on Feb. 9, 2009, (Bank. E.D. Va.
Case No.: 09-30805) Lynn L. Tavenner, Esq., Paula S. Beran, Esq.,
at Tavenner & Beran, PLC and McGuireWoods LLP represent the Debtor
in its restructuring efforts. Its financial advisor is Alvarez &
Marsal North America LLC. The Debtor's DIP Lender is Wells Fargo
Retail Finance LLC as administrative and collateral agent. The
Debtor listed total assets of $41,440,100 and total debts of
$35,499,00.
TED WATTS: Case Summary & Six Largest Unsecured Creditors
---------------------------------------------------------
Debtor: Ted B. Watts, Sr.
aka Theodore B. Watts, Sr.
aka Theodore Benjamin Watts, Sr.
P.O. Box 210907
Montgomery, AL 36121
Bankruptcy Case No.: 09-30663
Chapter 11 Petition Date: March 12, 2009
Court: Middle District of Alabama (Montgomery)
Judge: William R. Sawyer
Debtor's Counsel: Collier H. Espy, Jr., Esq.
KC@EMPPC.COM
Espy, Metcalf & Espy, P.C.
P.O. Drawer 6504
Dothan, AL 36302-6504
Tel: (334) 793-6288
Estimated Assets: $1 million to $10 million
Estimated Debts: $10 million to $50 million
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Compass Bank Personal guaranty $10,295,303
P.O. Box 44
Montgomery, AL 36101
Regions Bank Personal guaranty $5,501,261
P.O. Box 11407 secured: $300,000
Birmingham, AL 35246
Banktrust Personal guaranty $3,491,936
148 E. Main ST.
Prattville, AL 36067
AmeriFirst Bank Personal guaranty $1,560,043
P.O. Box 570
Union Springs, AL 36089
Federal Land Bank Assoc. Property; $540,000.00
of South Alabama FLCA secured $355,550
P.O. Box 241687
Montgomery, AL 36124-1687
River Bank and Trust CO. Personal guaranty $500,000
7055 Halcyon Park Drive
P.O. Box 240938
Montgomery, AL 36124
TENET HEALTHCARE: Shares Info on Acctng. Treatment of New Notes
---------------------------------------------------------------
Tenet Healthcare Corporation has recently exchanged a total of
$2,798,373,000 aggregate principal amount of its outstanding
Senior Note percentages which are due 2011, 2012, 2015, and 2018,
as reported in the Securities and Exchange Commission March 5.
From the outstanding 6.375% Senior Notes due 2011, the company
exchanged $914,834,000 aggregate principal amount and $484,453,000
aggregate principal amount of its outstanding 6.50% Senior Notes
due 2012 for $699,543,000 aggregate principal amount of new 9.0%
Senior Secured Notes due 2015 and $699,543,000 aggregate principal
amount of new 10.0% Senior Secured Notes due 2018. The New Notes
were offered for exchange only to eligible holders through a
private placement and have not been registered under the
Securities Act of 1933, as amended, or any state securities laws.
Tenet Healthcare filed a report with the Commission to provide
investors with information regarding the accounting treatment of
the New Notes.
Tenet Healthcare will make these estimated balance sheet entries,
which will be presented on its March 31, 2009 balance sheet as
filed in its Quarterly Report on Form 10-Q for that period, to
reflect the recent note exchange:
-- $4.778 billion of existing notes will be reduced to
$3.386 billion, a reduction of $1.392 billion, reflecting
the $1.399 billion of notes tendered, less $7 million in
related unamortized discounts;
-- accumulated other comprehensive loss will be reduced by
$6 million related to unrecognized interest rate hedge
settlement losses associated with the notes tendered;
-- the New Notes of $1.252 billion, net of $147 million in
discounts, will be added;
-- net gain on the exchange of approximately $134 million
(pre-tax and after-tax) will be recorded; and
-- cash disbursements of approximately $24 million for
issuance costs will be recorded as "other intangible
assets."
The earnings and cash flow impact related to interest of the note
exchange for the years ending December 31, 2009 and 2010 include:
-- incremental cash interest payments in 2009 of $21 million,
incremental cash interest expense in 2009 of $35 million
(excludes discount and issue cost amortization), and
incremental reported interest expense in 2009 of
$44 million; and
-- incremental cash interest payments in 2010 of $43 million,
incremental cash interest expense in 2010 of $43 million
(excludes discount and issue cost amortization), and
incremental reported interest expense in 2010 of
$56 million.
About Tenet Healthcare
Headquartered in Dallas, Texas, Tenet Healthcare Corporation --
http://www.tenethealth.com/-- through its subsidiaries, owns and
operates acute care hospitals and related ancillary health care
businesses, which include ambulatory surgery centers and
diagnostic imaging centers.
For the year ended December 31, 2008, the Company posted
$25 million in net income compared to $89 million in net loss for
2007. As of December 31, 2008, the Company's balance sheet showed
total assets of $8.17 billion, total liabilities of
$8.07 billion and shareholders' equity about $103 million.
* * *
Moody's Investors Service placed Tenet Healthcare Corporation's
senior unsecured debt rating at 'Caa1' in September 2006. The
rating still holds to date with a stable outlook.
TENNESSEE STONE: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Tennessee Stone Products, LLC
7415 Charlotte Pike
Nashville, TN 37209
Bankruptcy Case No.: 09-02504
Chapter 11 Petition Date: March 5, 2009
Court: United States Bankruptcy Court
Middle District of Tennessee (Nashville)
Judge: George C. Paine II
Debtor's Counsel: Steven L. Lefkovitz, Esq.
Law Offices Lefkovitz & Lefkovitz
618 Church St., Ste. 410
Nashville, TN 37219
Tel: (615) 256-8300
Fax: (615) 250-4926
Email: Stevelefkovitz@aol.com
Total Assets: $160,693.13
Total Debts: $550,921.81
A full-text copy of the Debtor's petition, including its largest
unsecured creditors, is available for free at:
http://bankrupt.com/misc/tnmb09-02504.pdf
The petition was signed by Larry Mashburn, Chief Manager of the
company.
THORNBURG MORTGAGE: Brings Kirkland and Houlihan Lokey on Board
---------------------------------------------------------------
Thornburg Mortgage Inc. said it has engaged Kirkland and Ellis LLP
as lead restructuring counsel to advise the Company on
restructuring matters, and Houlihan Lokey Howard & Zukin Capital,
Inc. as a financial advisor to assist the Company in discussions
with its key constituents, including creditors, current
shareholders and prospective new investors, and to help evaluate
and implement a recapitalization solution that addresses the
issues currently facing the Company.
The Company also said it intends to file a notification on Form
12b-25 with the Securities and Exchange Commission indicating that
it will not be filing its Annual Report on Form 10-K for the year
ended December 31, 2008, in a timely manner.
Thornburg Mortgage said Tuesday that its Amended and Restated
Override Agreement dated December 12, 2008, with JPMorgan Chase
Funding Inc. (formerly Bear Stearns Investment Products Inc.),
Citigroup Global Markets Limited, Credit Suisse Securities (USA)
LLC, Credit Suisse International, Greenwich Capital Markets, Inc.,
Greenwich Capital Derivatives, Inc., The Royal Bank of Scotland
plc, and UBS AG, expired in accordance with its terms. Thorburg
said it had reached agreement with all of the Counterparties to
forebear from demanding payment or exercising any remedies under
their various financing agreements through March 31, 2009, to
provide the Company with additional time to negotiate and
implement a restructuring plan.
The Company also entered into a Forbearance Agreement with
Citigroup whereby Citigroup, and Forbearance Agreement with UBS.
About Thornburg Mortgage
Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages. It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets. Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.
* * *
As reported in the Troubled Company Reporter on Dec. 22, 2008,
Standard & Poor's Ratings Services raised its counterparty credit
rating on Thornburg Mortgage Inc. to 'CC' from 'D'. At the same
time, S&P also raised its rating on Thornburg's senior notes to
'CC' from 'D'. The outlook is negative.
THORNBURG MORTGAGE: In Talks With Lenders for Covenant Waivers
--------------------------------------------------------------
The Amended and Restated Override Agreement dated December 12,
2008, by and among Thornburg Mortgage Inc. and JP Morgan Chase
Funding Inc. (formerly Bear Stearns Investment Products Inc.),
Citigroup Global Markets Limited, Credit Suisse Securities (USA)
LLC, Credit Suisse International, Greenwich Capital Markets, Inc.,
Greenwich Capital Derivatives, Inc., The Royal Bank of Scotland
PLC, and UBS AG expired in accordance with its terms March 15,
2009.
The Counterparties agreed in the Override Agreement to extend to
March 16, 2009, the maturity dates of the Company's payment
obligations under its reverse repurchase agreements, securities
lending agreements, interest rate caps and auction swap agreements
and waived their right to make additional margin calls under the
Financing Agreements during the term of the Override Agreement.
Upon the expiration of the Override Agreement, the Company's
payment obligations under the Financing Agreements (unless further
extended) will become immediately payable.
Thornburg is currently in discussions with all of the
Counterparties to further extend the maturity date of the
Company's matured obligations under the Financing Agreements or to
otherwise obtain agreements from each Counterparty to waive or
forbear from asserting any rights to payment under the Financing
Agreements through March 31, 2009.
The Company is currently considering various strategic
alternatives available to facilitate the restructuring of the
Financing Agreements that will be impacted by the expected
expiration of the Override Agreement, and there can be no
assurance that any such restructuring will be completed.
About Thornburg Mortgage
Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages. It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets. Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.
* * *
As reported in the Troubled Company Reporter on Dec. 22, 2008,
Standard & Poor's Ratings Services raised its counterparty credit
rating on Thornburg Mortgage Inc. to 'CC' from 'D'. At the same
time, S&P also raised its rating on Thornburg's senior notes to
'CC' from 'D'. The outlook is negative.
THORNBURG MORTGAGE: Lenders Agree to Forbearance Until March 31
---------------------------------------------------------------
Thornburg Mortgage, Inc., said Tuesday that its Amended and
Restated Override Agreement dated December 12, 2008 with JPMorgan
Chase Funding Inc. (formerly Bear Stearns Investment Products
Inc.), Citigroup Global Markets Limited, Credit Suisse Securities
(USA) LLC, Credit Suisse International, Greenwich Capital Markets,
Inc., Greenwich Capital Derivatives, Inc., The Royal Bank of
Scotland plc, and UBS AG, expired in accordance with its terms.
Thorburg said it had reached agreement with all of the
Counterparties to forebear from demanding payment or exercising
any remedies under their various financing agreements through
March 31, 2009, to provide the Company with additional time to
negotiate and implement a restructuring plan.
The Company entered into a Forbearance Agreement with GCD, GCM,
RBS, CSI, CSUSA and JPM, whereby each of those financing
counterparties agreed:
(i) to provide the Company with additional time to restructure
its obligations with the Counterparties and the Company's
noteholders, and
(ii) subject to certain terms and conditions, not to exercise
through March 31, 2009, certain remedies that might
otherwise be available to them under their respective
financings agreements or the security agreement previously
executed by the Company in favor of its financing
counterparties.
The Counterparties have also agreed that during the Standstill
Period they will not dispose of any securities or collateral
securing their respective financing agreements or take any action
to assert any deficiency claims thereunder. The Standstill Period
will terminate earlier if the Company breaches certain covenants
and will also terminate for each Counterparty if any other
Counterparty breaches its Forbearance Agreement.
Forbearance Deal with Citigroup
The Company also entered into a Forbearance Agreement with
Citigroup whereby Citigroup and the Company acknowledged that if
March 16, 2009, were the maturity date of the securities loans
outstanding under a Global Master Securities Lending Agreement
between the Company and Citigroup, the Company would be obligated
to return to Citigroup cash collateral of $1.02 billion, and
further agreed that on March 16, 2009, the market value of the
mortgage securities collateral pledged by the Company to secure
its payment obligation to Citigroup under the Global Agreement was
$626.4 million.
The parties agreed that Citigroup could retain the mortgage
collateral for its own account, with the market value of the
collateral being offset against the Company's payment obligation,
and agreed that the balance due from the Company under the Global
Agreement will constitute a continuing extension of credit by
Citigroup which will be due and payable on March 31, 2009, or
sooner if certain early termination events occur.
Citigroup further agreed that during the Citigroup Standstill
Period it will not assert any deficiency claim against the Company
or exercise certain remedies that might otherwise be available to
it under the Global Agreement or the Security Agreement.
Termination & Purchase Pact,
Forbearance Pact with UBS
The Company entered into a Termination and Purchase Agreement with
UBS pursuant to which (i) the Company agreed to transfer to UBS
certain securities previously financed by the Company through a
Master Repurchase Agreement between the Company and UBS, and (ii)
the parties agreed to apply the specified value of the Relevant
Securities against the aggregate purchase price otherwise due from
the Company to UBS under the Repurchase Agreement in respect of
the Relevant Securities.
The Company and UBS have further agreed that, after giving effect
to the transfer of the Relevant Securities to UBS, the Company
continues to owe UBS a deficiency amount of $86.6 million under
the Repurchase Agreement. However, UBS has in the Termination
Agreement granted the Company a grace period for the payment of
this deficiency amount pursuant to which the Company is not
required to make such payment until March 31, 2009, or sooner if
certain early termination events occur.
Concurrently with the execution of the Termination Agreement, the
Company also entered into a Forbearance Agreement with UBS whereby
UBS agreed that during the UBS Standstill Period it will not
assert any deficiency claim against the Company or exercise
certain remedies that might otherwise be available to it under the
Repurchase Agreement or the Security Agreement.
Sr. Sub Notes Holders Release Liens
The Company also said holders of a majority in principal amount of
the Company's Senior Subordinated Secured Notes due 2015 have
agreed to release liens on all collateral under the Senior
Subordinated Notes. As a result, the liens for the benefit of
holders of the Senior Subordinated Notes, as well as the liens
created concurrently with the issuance of the Senior Subordinated
Notes for the benefit of the Company's 8% Senior Notes due 2013,
have been released in accordance with the documents governing each
series of notes. The Company requested the lien release to
facilitate its ability to arrange additional financing in the
future.
The Company continues to evaluate various strategic alternatives
to restructure its remaining financing agreements, the
satisfaction of the deferred payment amounts, obligations to
noteholders and other obligations. The transactions may include a
consensual restructuring, reorganization or recapitalization of
the Company and may also include the filing of a petition for
relief under Chapter 11 of the United States Bankruptcy Code.
About Thornburg Mortgage
Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages. It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets. Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.
* * *
As reported in the Troubled Company Reporter on Dec. 22, 2008,
Standard & Poor's Ratings Services raised its counterparty credit
rating on Thornburg Mortgage Inc. to 'CC' from 'D'. At the same
time, S&P also raised its rating on Thornburg's senior notes to
'CC' from 'D'. The outlook is negative.
THORNBURG MORTGAGE: Matlin and Patterson Step Down as Directors
---------------------------------------------------------------
Thornburg Mortgage Inc. lost two directors in one day when David
J. Matlin and Mark R. Patterson notified the Board of Directors of
their resignation effective March 12.
Messrs. Matlin and Patterson each own 50% of the membership
interests in Matlin Patterson LLC, an affiliate of MP TMA LP and
MP TMA (Cayman) LP, the lead investors in the financing
transaction that the Company completed on March 31, 2008 for the
sale of up to $1.35 billion of senior subordinated secured notes,
warrants to purchase the Company's common stock and a
participation interest in certain mortgage-related assets.
In connection with the Financing Transaction and pursuant to the
Warrant Agreement, dated as of March 31, among the Company and the
warrant holders signatories thereto, the Company agreed to cause
the Board to consist of 10 directors and that, for so long as MP
TMA LP, MP TMA (Cayman) LP and their respective affiliates
beneficially own shares of Common Stock or unexercised warrants
for shares of Common Stock representing (a) at least 5% but less
than 10% of the shares of Common Stock outstanding on a fully
diluted basis, MP may designate one director, (b) at least 10% but
less than 15% of the shares of Common Stock outstanding on a fully
diluted basis, MP may designate two directors and (c) at least 15%
of the shares of Common Stock outstanding on a fully diluted
basis, MP may designate three directors.
MP partially exercised its director designation rights April 22,
2008, and in accordance with the terms of the Warrant Agreement,
designated Messrs. Matlin and Patterson, who were elected to the
Board.
At this time, MP has not designated any replacement directors.
About Thornburg Mortgage
Based in Santa Fe, New Mexico, Thornburg Mortgage Inc. (NYSE: TMA)
-- http://www.thornburgmortgage.com/-- is a single-family
residential mortgage lender focused principally on prime and
super-prime borrowers seeking jumbo and super-jumbo adjustable-
rate mortgages. It originates, acquires, and retains investments
in adjustable and variable rate mortgage assets. Its ARM assets
comprise of purchased ARM assets and ARM loans, including
traditional ARM assets and hybrid ARM assets.
* * *
As reported in the Troubled Company Reporter on Dec. 22, 2008,
Standard & Poor's Ratings Services raised its counterparty credit
rating on Thornburg Mortgage Inc. to 'CC' from 'D'. At the same
time, S&P also raised its rating on Thornburg's senior notes to
'CC' from 'D'. The outlook is negative.
TRIBUNE CO: Aims at Stopping ERISA Suit Versus Officers
-------------------------------------------------------
Tribune Co. asks the U.S. Bankruptcy Court for the District of
Delaware to stop a class-action suit against it and its
executives.
According to Bloomberg's Bill Rochelle, three months before
Tribune filed for Chapter 11 protection, several former and
current employees filed a class-action suit in U.S. District Court
in Illinois contending that Tribune in the U.S. violated federal
employment law governing the employee ownership plan trust
involved in the $13.8 billion leveraged buyout led by Sam Zell in
December 2007.
The plaintiffs say that they are no longer continuing the suit
against Tribune. The "automatic stay" provisions of the
Bankruptcy Code stop creditors' causes of action upon bankruptcy
filing by a debtor. In other words, a bankruptcy filing triggers
an injunction against the continuance of any action by any
creditor against the debtor or the debtor's property.
The Company, nonetheless, filed papers in the Bankruptcy Court
contending the Illinois lawsuit is in violation of the automatic
stay resulting from the Chapter 11 filing. Tribune wants the suit
halted even as to the other defendants -- to Mr. Zell and other
Tribune executives -- who are non-debtors in Tribune's Chapter 11
cases. Tribune says its proposal is warranted as the suit is a
distraction keeping executives away from the important chore of
reorganizing the company.
Although it has an insurance policy that covers the suit, Tribune
says the billions in damages the plaintiffs seek far exceeds
coverage.
Tribune wants the Court to issue a temporary injunction, pending
final hearing on its proposal.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Company --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball
team. The company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No.
08-13141). The Debtors proposed Sidley Austion LLP as their
counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware
counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as
financial advisors; and Epiq Bankruptcy Solutions LLC as claims
agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in
total assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: To Negotiate One-Year Extension of $225MM Financing
---------------------------------------------------------------
Tribune Co. said in papers submitted to the U.S. Bankruptcy Court
for the District of Delaware that it expects to negotiate a one-
year extension of the $225 million trade receivables
securitization financing that otherwise will expire in April,
Bloomberg News reports.
According to Bloomberg's Bill Rochelle, the new facility is
expected to be similar to the existing loan and will have a
$75 million revolving credit and a $150 million term loan.
Tribune and its affiliates have notified Judge Kevin Carey that
they are arranging a proposed amended asset-backed debtor-in-
possession credit facility with Barclays Capital, Inc.
Tribune Co. and its wholly owned special purpose non-debtor
subsidiary, Tribune Receivables, LLC, are parties to a
$300,000,000 trade receivables securitization facility under
which Barclays Bank PLC is the administrative agent and Tribune
Receivables is the borrower. That receivables securitization
facility expires on April 10, 2009.
The proposed amended asset-backed DIP Facility, according to
Bryan Krakauer, Esq., at Sidley Austin, LLP, in Chicago,
Illinois, will have a maturity date of up to April 10, 2010, and
will consist of:
-- a $75,000,000 Revolving Line of Credit, and
-- a $150,000,000 Term Loan.
The proposed Asset-Backed DIP Facility will have substantially
the same terms as the Existing Facility, including accounts
receivable advance rates, mechanics, security and account control
agreements subject to certain adjustments to reflect the longer-
term nature of the proposed Asset-Backed DIP Facilities.
Availability under both the Revolver and Term Loan will be
subject to a borrowing base. The borrowing base will be
calculated on a daily basis and would be a dynamic amount
determined by applying receivables eligibility criteria and
certain customary accounts receivable securitization reserves.
The proposed Asset-Backed DIP Financing will be secured by:
(a) first priority lien on all the assets of Tribune
Receivables;
(b) first priority lien on all unencumbered assets of
guarantors on the Petition Date; and
(c) junior lien on all encumbered assets of guarantors on the
Petition Date.
A full-text copy of the proposed Asset-Backed DIP Financing
Facilities is available for free at:
http://bankrupt.com/misc/Tribune_Asset-BackedDIP.pdf
The Debtors note that the information provided in the Asset-
Backed Financing is preliminary in nature and is subject to
change. According to Mr. Krakauer, there is no assurance the
facilities will be extended on the proposed terms. The Debtors
have yet to file a motion with the Court seeking the approval of
the amended Asset-Backed DIP Financing Facilities.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Company --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball
team. The company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No.
08-13141). The Debtors proposed Sidley Austion LLP as their
counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware
counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as
financial advisors; and Epiq Bankruptcy Solutions LLC as claims
agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in
total assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Can Hire McDermott as Special Counsel
-------------------------------------------------
Judge Kevin Carey of the U.S. Bankruptcy Court for the District of
Delaware has authorized
Tribune Company and its debtor-affiliates to employ McDermott Will &
Emery LLP as special
counsel for general domestic legal matters, nunc pro tunc to the Petition Date.
According to the Debtors, McDermott has agreed to continue to advise
them in their Chapter 11
cases. McDermott has been an outside counsel to the Debtors and their
debtor affiliates for more
than 20 years.
McDermott will assist the Debtors in a wide variety of general
domestic legal matters including tax, employment benefits,
employment, corporate, real estate, and other legal matters that
may arise in the ordinary course of their business.
The Debtors propose to pay McDermott for their legal services on
an hourly basis in accordance with its customary rates:
Partners & Counsel $445-$1,010
Associates $285-$590
Paraprofessionals $105-$345
According to the Debtors, McDermott has received a retainer
amounting to $500,000, in connection with its representation on
the general domestic legal matters. A portion of the retainer
has been applied to all prepetition fees and expenses incurred,
and the remainder will constitute a general retainer for
postpetition services and expenses, the Debtors tell the Court.
Moreover, the Debtors note, in addition to the retainer,
McDermott has received approximately $7,037,500, within one year
prior to the Petition Date on account of the services it
rendered.
Blake D. Rubin, a partner of McDermott Will & Emery LLP, in a
supplemental affidavit, said his
firm currently represents two of the Debtors' non-Debtor affiliates --
the Chicago National Ball
Club, LLC and TV FN Cable Ventures, Inc. McDermott will not represent
either of these two non-
Debtor affiliates in matters related to the Debtors' Chapter 11 cases.
Mr. Rubun said the Office of the United States Trustee has raised
concerns about McDermott
potentially having a claim against the Debtors in connection with
payments McDermott received
during the 90 days prior to the Petition Date. As requested by the
U.S. Trustee, McDermott sent to
the Court a list of the payments it received from the Debtors before
the Petition Date, is available
for free at:
http://bankrupt.com/misc/Tribune_McDermottPayments.pdf
As requested by the Trustee, McDermott also agreed to return
approximately $288,600 to the
Debtors. According to Mr. Rubin,
McDermott disagrees that the payments made between October 3, and
December 5, 2008, constitute preferential transfers.
Nevertheless, Mr. Rubin said, McDermott has agreed to return the
payments to the Debtors' estates and to waive any resulting claim
against the Debtors' estates.
The professionals who are expected to render services to the
Debtors are:
Name Rate
----- ----
Ruben, Blake D. $915
Levine, Philip $850
Whiteway, Andrea M. $750
Gruemmer, Brooks $690
Compernolle, Paul J. $675
Offutt, P.C., Gerald $630
Finkelstein, Jon G. $580
Harris, Ryan $515
Opper, Mark $490
Chan, Gale $320
Shuman, Timothy $320
Fuchs, Daniel $315
McCurry, Patrick J. $305
Mr. Rubin, in another supplemental affidavit, said his firm does not
hold or represent any interest
adverse to the Debtors' estates and is a "disinterested person" as
that term is defined in Section
101(14) of the Bankruptcy Code.
Kate J. Stickles, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., in Wilmington, Delaware, submitted with the Court
a certification of counsel regarding the revised proposed form of
order of McDermott's application, which contains modifications to
address the concerns raised by the U.S. Trustee. According to Ms.
Stickles, the Debtors and the
U.S. Trustee have agreed to convert the employment application under
Section 327(a) of the
Bankruptcy Code without modifying the proposed scope of McDermott's employment.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Company --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball
team. The company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No.
08-13141). The Debtors proposed Sidley Austion LLP as their
counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware
counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as
financial advisors; and Epiq Bankruptcy Solutions LLC as claims
agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in
total assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRIBUNE CO: Gets Court OK to Hire Jones Day as Litigation Counsel
-----------------------------------------------------------------
Judge Kevin Carey of the U.S. Bankruptcy Court for the District of
Delaware has authorized
Tribune Company and its debtor-affiliates to employ Jones Day as their
litigation counsel.
Kate J. Stickles, Esq., at Cole, Schotz, Meisel, Forman &
Leonard, P.A., in Wilmington, Delaware, said no objections were filed
as to the application.
The Debtors relate Jones Day has represented them in various
antitrust and commercial litigation matters prior to the Petition
Date. The Debtors anticipate that Jones Day will continue to
advise them with respect to those antitrust and commercial
litigation matters, as well as similar matters as they may
request during the pendency of the Chapter 11 cases.
According to the Debtors, they have paid Jones Day $130,015
within one year before the Petition Date on account of services
rendered.
The Debtors propose to pay Jones Day based on the firm's current
hourly rates:
Professional Rate/Hour
------------ ---------
Phillip A. Proger $900
Ryan C. Thomas $475
Larissa C. Bergin $325
Phillip A. Proger, Esq., at Jones Day, said his firm does not have any
connection with the United
States Trustee for the District of Delaware or any creditors or
parties-in-interest that would be
adverse to the Debtors or their estates. Moreover, Mr. Proger notes,
Jones Day does not hold or
represent an interest adverse to the Debtors.
Mr. Proger said in a supplemental affidavit that his firm has been
retained to represent 6400-6500
Park of Commerce Boulevard, LLC, a subsidiary of Prime Property Fund,
in connection with a
lease of non-residential real property. According to Mr. Proger,
Jones Days' representation of Park
Commerce will include in its scope any matters associated with the
Debtors' treatment of the
applicable lease under Section 365 of the Bankruptcy Code, including
any claims arising against
the Debtors' estates.
About Tribune Co.
Headquartered in Chicago, Illinois, Tribune Company --
http://www.tribune.com/-- is a media company, operating
businesses in publishing, interactive and broadcasting, including
ten daily newspapers and commuter tabloids, 23 television
stations, WGN America, WGN-AM and the Chicago Cubs baseball
team. The company and 110 of its affiliates filed for Chapter 11
protection on December 8, 2008 (Bankr. D. Del. Lead Case No.
08-13141). The Debtors proposed Sidley Austion LLP as their
counsel; Cole, Schotz, Meisel, Forman & Leonard, PA, as Delaware
counsel; Lazard Ltd. and Alvarez & Marsal North Americal LLC as
financial advisors; and Epiq Bankruptcy Solutions LLC as claims
agent. As of Dec. 8, 2008, the Debtors have $7,604,195,000 in
total assets and $12,972,541,148 in total debts.
Bankruptcy Creditors' Service, Inc., publishes Tribune
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by Tribune Company and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TRONOX INC: Shareholders Might Have Recovery, Says Report
---------------------------------------------------------
"Official shareholders' committees usually aren't appointed unless
there is some chance existing stockholders might be entitled to a
distribution under a Chapter 11 plan," says Bloomberg's Bill
Rochelle.
As reported in yesterday's Troubled Company Reporter, Diana G.
Adams, the U.S. Trustee for Region 2, on March 13, appointed these
parties to the committee of equity security holders of Tronox,
Inc., et al:
1. Ahar Capital Management Inc.
299 Park Avenue, 17th Floor
New York, New York 10171
ATTN: Rebwar Berzinji, Senior Analyst
Telephone No. (212) 653-1045
Fax No. (212) 653-1099
2. Charles E. Cheever
65 Comstock Hill Avenue
Norwalk, CT 06850
3. RLR Capital Partners, LP
152 West 57th Street, 21st Floor
New York, New York 10019
ATTN: Robert L. Rosen
Telephone No. (212) 903-2700
Fax No. (212) 903-2727
4. Mark D. Todd
19 Runner Road
Savannah, GA 31410
Telephone No. (912) 897-5336
5. Sandra Kay Grasso
2874 Seine Avenue
Highland, CA 92346
Telephone No. (909) 864-6321
6. Sam L. Decker and Myra A. Decker
10816 West Country Drive
Oklahoma City, OK 73170
Telephone No. (405) 692-7751
7. Douglas Graham
254 E 68th Street, Apt. 8C
New York, New York 10065
Telephone No. (646) 824-8833
Fax No. (646) 330-5398
Dated: New York, New York
At the Feb. 6 omnibus hearing, David A. Crichlow, Esq., at
Pillsbury Winthrop Shaw Pittman LLP, in New York, appeared at the
hearing, saying the he represented an ad hoc equity committee.
The U.S. Trustee had earlier appointed a committee of unsecured
creditors. Statutory committees are entitled to hire attorneys
and advisers whose fees will be paid by the debtor.
Under the absolute priority rule of the Bankruptcy Code, however,
secured creditors have priority over a company's unsecured
creditors to the extent of the value of their collateral.
Unsecured creditors, on the other hand, stand ahead of investors
in the receiving line and their claims must be satisfied before
any investment loss is compensated.
Tronox had $1.6 billion in total assets, including $646.9 million
in current assets, as at Sept. 30, 2008. The Company had US$881.6
million in current debts and $355.9 million in total noncurrent
debts. In its bankruptcy petition, the Company said that as of
November 30, 2008, total assets are $1,557,000,000, and total
debts are $1,221,600,000.
Common Stock Holders
As of December 31, 2008, Tronox Inc. had 19,107,367 outstanding
shares of class A common stock and 22,889,431 outstanding shares
of class B common stock. Tronox stocks are traded on the Over the
Counter Bulletin Board under the symbols TROX.A.PK and TROX.B.PK.
On March 13, when the Trustee appointed an equity committee,
Tronox's Class A stock opened at $0.08 a share, the highest during
the week, but closed at $0.05 apiece. The stock continued to
close at $0.05 on March 16.
Ahab Opportunities, Ltd., on February 4, disclosed to the Court
that as of January 27, 2009, it held 382,500 shares of Class A
common stock and 1,625,000 shares of Class B common stock.
Holders of at 4.75% of all outstanding shares, equivalent to
1,975,000 shares of Class A and/or Class B common stock, are
required to provide disclosures to the Bankruptcy Court, and
trading in of their shares are restricted.
Present or former holders of more than 5% of Tronox's equity
securities updated the Securities and Exchange Commission with
respect to their shareholdings in the Company:
-- RLR Capital Partners, LP, disclosed the SEC that as of
March 11, 2009, it owns an aggregate of 50,699 shares of
Tronox Class B common stock, reducing its stake to 0.2%. It
said that it distributed 1,334,626 Class B shares to outside
investors.
-- Charles Cheever and Cheever Partners LLC disclosed in a
Schedule 13G filed on February 25, 2009, that they are s
deemed to beneficially own 1,186,509 shares of Tronox
Incorporated Class B common stock, representing 5.2% of the
shares outstanding. Cheever also owns 630,000 shares of
Tronox Class A Common Stock.
-- In a 13G filing, Investment Counselors of Maryland, LLC, said
that as of Dec. 31, 2008, it no longer owns Class B common
stock of Tronox.
-- In a Schedule 13G filed February 17, 2009, Henderson Global
Investors Limited disclosed that it beneficially owns
1,937,723 shares of Tronox Class B Common Stock, representing
8.47% of the shares outstanding.
-- On Feb. 17, LaGrange Capital Partners, L.P., disclosed in a
Form 13G filing that it is deemed to beneficially own an
aggregate of 1,339,635 shares of Tronox Incorporated,
representing 5.9% of the shares outstanding.
-- On Feb. 17, joint filers Michael A. Roth and Brian J. Stark
reported that they are d7eemed to beneficially own Tronox
Class A Common Stock equal to, and representing, less than 5%
of Tronox shares outstanding.
-- On Feb. 17, in a Form 13G, Ahab Opportunities, Ltd., and its
related entities disclosed that they beneficially own 900,000
shares of Class A common stock of Tronox Incorporated,
representing of 4.9% of the shares. Ahab also said it owns
3,250,000 shares of Tronox Class B common stock, representing
14.2% of the issued shares.
-- On Feb. 13, Philip J. Hempleman, the managing partner of
Ardsley and Ardsley Partners II, said he is deemed to
beneficially own an aggregate of 1,170,000 shares,
representing 6.31% of Tronox common stock.
-- On Feb. 9, Dimensional Fund Advisors LP disclosed that
it is deemed to beneficially own an aggregate of 605,800
shares of Tronox Class A common stock, representing 3.26%
of the Tronox shares outstanding.
Annual Report Delay
Tronox has informed the Court that it won't be unable to file its
annual report on Form 10-K on time.
Tronox explains that in connection with the filing of its Chapter
11 cases, it is continuing to perform an impairment analysis
related to certain of its tangible and intangible assets and a
review of certain of its environmental reserves. "It is expected
that the completion of the impairment analysis will result in the
Report reflecting a significant change in results of operations
from the corresponding period for the last fiscal year."
The Company, nonetheless, said it expects to report net sales of
$1.5 billion for the year-ended December 31, 2008 compared to net
sales of $1.4 billion for the year-ended December 31, 2007. In
addition, the company expects to report gross margin of $65
million compared to a gross margin of $116 million in 2007.
Pending the completion of the final analysis, the Company,
however, is unable to provide an estimate of net income (loss) at
this time.
About Tronox Inc.
The company is the world's third largest maker of titanium dioxide
behind DuPont Co. and Saudi-owned National Titanium Dioxide Co.,
known a Cristal, according to Bloomberg.
Tronox has $1.6 billion in total assets, including $646.9 million
in current assets, as at September 30, 2008. The company has
$881.6 million in current debts and $355.9 million in total
noncurrent debts.
Tronox Inc., aka New-Co Chemical, Inc., and 14 other affiliates
filed for Chapter 11 protection on January 13, 2009 (Bankr. S.D.
N.Y. Case No. 09-10156). The case is before Hon. Allan L.
Gropper. Richard M. Cieri, Esq., Jonathan S. Henes, Esq., and
Colin M. Adams, Esq., at Kirkland & Ellis LLP in New York,
represent the Debtors. The Debtors also tapped Togut, Segal &
Segal LLP as conflicts counsel; Rothschild Inc. as investment
bankers; Alvarez & Marsal North America LLC, as restructuring
consultants; and Kurtzman Carson Consultants serves as notice and
claims agent.
Until September 30, 2008, Tronox Inc. was publicly traded on the
New York Stock Exchange under the symbols TRX and TRX.B. Since
then, Tronox Inc. has traded on the Over the Counter Bulletin
Board under the symbols TROX.A.PK and TROX.B.PK. As of
December 31, 2008, Tronox Inc. had 19,107,367 outstanding shares
of class A common stock and 22,889,431 outstanding shares of
class B common stock.
Bankruptcy Creditors' Service, Inc., publishes Tronox Bankruptcy
News. The newsletter tracks the chapter 11 proceeding undertaken
by Tronox Inc. and its 14 affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)
TROPICANA ENTERTAINMENT: Dispute on 'Tropicana' Name Arises
-----------------------------------------------------------
Tropicana Entertainment LLC and its affiliates are in the process
of seeking support and confirmation of reorganization plans that
would split Atlantic City and Las Vegas casino operations.
Tropicana may lose support from one of its key stakeholders, Onex
Corp., the largest buyout firm in Canada, if the issue as to who
owns the Tropicana name is not resolved.
Onex is the beneficial owner of more 40% of the outstanding
$440 million senior secured LandCo Credit Facility, which is an
obligation of and secured by all of the assets of the LandCo
Debtors. Onex is the largest known creditor of the LandCo estates
and will be largest shareholder of the reorganized LandCo
enterprise. Onex has been actively involved in the negotiation of
the LandCo Plan and supported the Court's approval of the LandCo
Disclosure Statement at last week's hearing.
Onex, however, objects to the Debtors' proposal to extend their
exclusive rights to solicit acceptances of their Chapter 11 plans
so that it "can file an alternative plan of reorganization that is
not tainted by recently-materialized conflicts of interest on the
part of the Debtors' existing management and professionals."
Foothill Group Inc., which owns another 10% of the outstanding
LandCo Credit Facility, has filed a joinder to Onex's objection.
Onex's ire came after it received, just after the hearing on the
Disclosure Statement, a term sheet to an OpCo-LandCo Trademark
License Agreement, which has these provisions:
-- The OpCo Debtors will license to the LandCo Debtors use of
the TROPICANA trademark;
-- The OpCo Debtors will grant the LandCo Debtors a royalty-
bearing, exclusive, non-transferable license to use the
TROPICANA trademark and logo solely in connection with (a)
the operation of the casino and hotel located at 3801 Las
Vegas Boulevard South, Las Vegas, Nevada 891909, (b) the
marketing and advertising of the stie, and (c) merchandise
provided solely onsite at the site.
-- The LandCo Debtors will pay to the OpCo Debtors a royalty
in the amount of $2 million per year per term.
-- The license will be in effect for a period of five years,
and the parties may mutually agree to an extension.
-- The LandCo Debtors may terminate the Agreement for its
convenience upon 180 days' notice. During the initial
three years of the term, the licensee will pay to the OpCo
Debtors a termination fee of $3 million; during the fourth
year of the term, a fee of $2 million; and, during the
fight year, licensee will pay $1 million.
A copy of the Term Sheet is available for free at:
http://bankrupt.com/misc/Tropicana_Trademark_TermSheet.pdf
"Specifically, just after last week's hearing, the Debtors'
management and professionals, who control and represent,
respectively, both the LandCo Debtors and the OpCo Debtors,
transmitted a "term sheet" - apparently prepared by the LandCo
Debtors' counsel several days before the hearing but conveniently
not disseminated until Disclosure Statement approval was procured
- which granted to OpCo sole and exclusive ownership of the name
"Tropicana" and other trademarks and provided for reorganized
LandCo license the name and marks for truly exorbitant sums
($10 million over five years, with termination fees of up to
$3 million)" Onex complained.
The proposed OpCo-LandCo Trademark License Agreement is
"outrageous and unjustified," says Onex's counsel, Robert S.
Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, in
Wilmington, Delaware.
Mr. Brady, points out, among other things, predecessors of the
LandCo Debtors (not the OpCo Debtors) were the owners and first
users of the "Tropicana" marks and have used them continuously for
more than 50 years (indeed, the Tropicana is a Las Vegas landmark,
so much so that the hotel and casino are located on a major
thoroughfare now named "Tropicana Avenue"), and neither the LandCo
Debtors nor their predecessors have ever executed any license or
paid any royalties with respect to the marks (to OpCo or anyone
else).
Indeed, the LandCo Debtors, according to Mr. Brady, unequivocally
represented and warranted to the LandCo Lenders that their
collateral included all rights used in the LandCo business, and
the LandCo Debtors' initial filed Disclosure Statement
specifically recognized that the LandCo Debtors, at a minimum,
"have registered several service marks and trademarks with the
United States Patent and Trademark Office or otherwise have
acquired licenses to use those which are material to the conduct
of our business."
"In light of these facts, it is inconceivable that anyone owing a
fiduciary duty or any allegiance at all to the LandCo Debtors
would make such a proposal. Because the proposal was made by the
LandCo Debtors' management and counsel, the inescapable conclusion
is that the LandCo Debtors' fiduciaries (e.g., their counsel,
management and board of directors) have abdicated their fiduciary
duties to the LandCo Debtors and their creditors," Mr. Brady
asserts.
To make matters worse, the LandCo Debtors are attempting to use
plan exclusivity to advance the interests of OpCo to the detriment
of LandCo constituents, Mr. Brady asserts. In particular, with
continued exclusivity, the LandCo Debtors are able to threaten
further delay with ongoing and mounting operational losses and
professional fees continually diminishing the LandCo Lenders'
recovery -- as a means to extract unjustified concessions from the
LandCo Lenders with respect to the Tropicana trademark and other
issues.
Since the Debtors and the LandCo Lenders (and the OpCo Lenders)
agree that the Chapter 11 cases need to be concluded as promptly
as possible, Onex has proposed that inter-Debtor conflicts like
the right to the trademark be left for resolution between the
reorganized LandCo and OpCo entities (which will soon be separate
companies with separate boards of directors, separate management,
and separate and unconflicted counsel), with each entity retaining
whatever rights they currently have. The Debtors have not even
responded to Onex's straightforward proposal, Mr. Brady tells the
Court.
Onex requests that exclusivity be terminated so that, if an
impasse is reached on the remaining open issues with respect to
the LandCo Plan -- including issues relating to the Tropicana
trademark -- the LandCo Lenders or other creditors can file their
own plan immediately in order to minimize the delay (and
accompanying losses) from any further disagreement with the
Debtors.
The proposed exclusivity extension is scheduled for hearing on
March 18.
* * *
In a supplement to its objection, Onex said that it is now aware
that, through Scott Butera, the Debtors attempted to email the
Term Sheet to Alex Yemenidjian (an individual consulting with Onex
in this matter) on March 4, the day before the Disclosure
Statement hearing. However, because Mr. Yemenidjian's email
server was offline on March 4 and much of March 5, Mr. Butera's e-
mail message (and a subsequent email sent on March 5) was not
received by Mr. Yemenidjian and apparently was "bounced back" to
Mr. Butera. Ultimately, after calling Mr. Yemenidjian on the
afternoon of March 5, Mr. Butera faxed the Term Sheet to Mr.
Yemenidjian, who received it after the Disclosure Statement.
According to Onex, representatives of the Debtors did not email
the Term Sheet to its counsel or other representatives, and the
Debtors' counsel did not deliver or mention the Term Sheet to its
counsel at the Disclosure Statement hearing.
About Tropicana Entertainment
Based in Crestview Hills, Kentucky, Tropicana Entertainment LLC --
http://www.tropicanacasinos.com/-- is an indirect subsidiary of
Tropicana Casinos and Resorts. The company is one of the largest
privately-held gaming entertainment providers in the United
States. Tropicana Entertainment owns eleven casino properties in
eight distinct gaming markets with premier properties in Las
Vegas, Nevada, and Atlantic City, New Jersey.
Tropicana Entertainment LLC filed for Chapter 11 protection on
May 5, 2008, (Bankr. D. Del. Case No. 08-10856). Its debtor-
affiliates filed for separate Chapter 11 petitions but with no
case numbers assigned yet. Kirkland & Ellis LLP and Mark D.
Collins, Esq., at Richards Layton & Finger, represent the Debtors
in their restructuring efforts. Their financial advisor is Lazard
Ltd. Their notice, claims, and balloting agent is Kurtzman Carson
Consultants LLC. Epiq Bankruptcy Solutions LLC is the Debtors'
Web site administration agent. AlixPartners LLP is the Debtors'
restructuring advisor.
Stroock & Stroock & Lavan LLP and Morris Nichols Arsht & Tunnell
LLP represent the Official Committee of Unsecured Creditors in
this case. Capstone Advisory Group LLC is financial advisor to
the Creditors' Committee.
Bankruptcy Creditors' Service, Inc., publishes Tropicana
Bankruptcy News. The newsletter tracks the chapter 11
restructuring proceedings commenced by Tropicana Entertainment
LLC and its affiliates. (http://bankrupt.com/newsstand/or
215/945-7000)
TXCO Resources: Going Concern Doubt Raised; Warns of Bankruptcy
---------------------------------------------------------------
TXCO Resources Inc. relates that the financial statements reported
in its Form 10-K for the 2008 fiscal year contain a "going
concern" qualification in the opinion of the Company's independent
auditors, Akin, Doherty, Klein & Feuge P.C. The auditors have
included in their opinion an explanatory paragraph indicating that
TXCO's working capital deficiency, non-compliance with its current
ratio debt covenant under its bank credit facilities, and
violation of a provision in its certificates of designations for
its Series D and Series E preferred stock giving the holders of
the preferred stock the right to demand redemption of such stock,
raise substantial doubt about TXCO's ability to continue as a
going concern.
During 2008, TXCO engaged in the largest capital expenditure
program in its history. Costs incurred in the development and
purchase of oil and gas properties increased from $117 million in
2007 to $182 million in 2008. While pursuing its drilling
program, costs to drill escalated throughout the summer followed
by an unprecedented collapse in commodity prices. The time lag
between incurring drilling costs and the resulting increase in
revenues from new production, combined with deteriorating economic
conditions, have created severe cash flow constraints for TXCO.
As a result, TXCO has recently experienced substantial
difficulties in meeting short-term cash needs, particularly its
vendor commitments.
On Monday, TXCO reported $5.8 million in net income for year 2008,
compared to net income of $1.3 million for 2007. At December 31,
2008, TXCO had $486.8 million in total assets and $331.1 million
in total liabilities. The Company's balance sheet shows strained
liquidity with $$44.8 million in total current assets on $301.8
million in total current liabilities.
TXCO reported $49.7 million in trade payables at year-end 2008, of
which approximately $4.1 million are currently 60 days or more
past due. TXCO's failure to reach accommodations with its vendors
could result in the filing of liens or the withdrawal of trade
credit, and could limit its ability to conduct operations on
Company properties.
Bankruptcy Warning
TXCO has determined in preparing its 2008 financial statements
that it was in violation of the current ratio covenant of its bank
credit facilities. As a result of this default, its lenders may,
among other things, declare all or any part of the unpaid
principal and accrued interest under its bank credit facilities
immediately due and payable. Consequently in accordance with
GAAP, $153.0 million in long-term debt was reclassified as a
current liability. TXCO's lenders currently are not permitting it
to make additional borrowings under its bank credit facilities.
If TXCO's lenders demanded repayment and TXCO failed to repay the
amounts due under the bank credit facilities, the lenders could
exercise their remedies under the bank credit facilities,
including foreclosing on substantially all TXCO's assets, which
TXCO pledged as collateral to secure its obligations under the
bank credit facilities. These circumstances could require TXCO to
seek relief through a filing under the U.S. Bankruptcy Code.
TXCO is in discussions with its lenders regarding a waiver of the
current ratio covenant and other arrangements through which the
lenders would refrain from exercising their rights under the bank
credit facilities as a result of the default. However, there can
be no assurance that TXCO will be able to obtain such a waiver or
obtain other relief from its lenders.
$256.9-Mil. Working Capital Deficiency
Under the terms of TXCO's certificates of designations for its
Series D and Series E preferred stock, the default under the bank
credit facilities results in the holders of the Series D and
Series E preferred stock having a right to demand redemption of
their preferred stock. Consequently $66.9 million, representing
the stated value of the preferred stock at December 31, 2008, was
reclassified as a current liability. However under the terms of
the certificates of designations, TXCO's obligation to pay the
redemption price of any preferred stock demanded to be redeemed is
suspended until the earlier of (a) October 31, 2012, or (b) the
date that all of TXCO's obligations under the bank facilities have
been satisfied.
As a result of the $153.0 million in long-term debt and $66.9
million in preferred stock being reclassified to current
liabilities and the outstanding trade payables of $49.7 million,
TXCO reported a working capital deficiency of $256.9 million at
year-end 2008. TXCO's ability to continue as a going concern will
depend on its ability to generate additional sources of capital in
the near future, of which there can be no assurance.
Substantially all of the Company's assets are pledged, and extreme
volatility in energy prices and a deteriorating global economy,
have significantly hindered its ability to raise debt and equity
capital. Management is pursuing options to improve liquidity by
implementing several cost-reduction measures, including staff
reductions and shutting down certain operations.
Goldman Sachs on Board
TXCO has retained Goldman, Sachs & Co. to perform a strategic
alternatives review. This review is designed to enhance
stockholder value, which may include sale of certain assets,
issuance of stock, additional debt or other securities, or a
merger or sale of the Company. No formal decisions have been made
and no agreements have been reached at this time. There can be no
assurance that any particular alternative will be pursued or that
any transaction will occur, or on what terms. TXCO does not
expect to disclose developments from this review unless its board
of directors approves a definitive transaction.
Operations Update
TXCO has significantly reduced drilling in light of current
commodity prices and liquidity constraints. It is moving ahead
with a limited drilling program, focused on high-impact projects,
particularly the Maverick Basin's Pearsall and Eagle Ford shale
gas resource plays. It currently has two rigs operating.
Management Perspective
"TXCO's leasehold assets have excellent prospects but currently we
face extraordinary challenges following the unprecedented collapse
in oil and gas prices that occurred late last year," said Chairman
and CEO James E. Sigmon. "We are moving ahead, within current
financial constraints, to drill the Eagle Ford, Pearsall,
Georgetown and other highly prospective plays. We're taking
aggressive and prudent actions to re-set financial obligations of
the Company and to our stakeholders. We also are continuing our
strategic alternatives review. Our goal continues to be converting
the extensive potential of our large acreage position with
multiple plays into stockholder value."
March 19 Conference Call
TXCO has scheduled a conference call to update investors on recent
events for 9 a.m. CDT (10 a.m. EDT), Thursday, March 19, 2009.
The call will be broadcast live via the Company's Web site at
http://www.txco.com/concall.html,and by telephone at 877-387-9209
(U.S./Canada) and 706-643-3820 (international), passcode 86336244.
A replay will be available through Friday, March 20, at 800-642-
1687 (U.S./Canada) and 706-645-9291 (international), same
passcode, and for 30 days at http://www.txco.com/concall.html
About TXCO Resources
Based in San Antonio, Texas, TXCO Resources Inc. --
http://www.txco.com-- is an independent oil and gas enterprise
with interests in the Maverick Basin, the onshore Gulf Coast
region and the Marfa Basin of Texas, and the Midcontinent region
of western Oklahoma. TXCO's business strategy is to build
stockholder value by acquiring undeveloped mineral interests and
internally developing a multi-year drilling inventory through the
use of advanced technologies, such as 3-D seismic and horizontal
drilling. It accounts for its oil and gas operations under the
successful efforts method of accounting and trades its common
stock on Nasdaq's Global Select Market under the symbol "TXCO."
U-SAFE INVESTMENTS: Secured Creditors Object to Dismissal of Case
-----------------------------------------------------------------
JCRA Investment Co., LLC, Hsien Jen Wang, and James Lin, secured
creditors of U Safe Investments, LLC, objects to the motion of U
Safe Investments, LLC to dismiss its Chapter 11 bankrutpcy case.
As reported in the Troubled Company Reporter on February 16, 2009,
U-Safe Investments, LLC, asked the U.S. Bankruptcy Court for the
Northern District of California to dismiss its Chapter 11 case for
cause. The Debtor disclosed that it cannot propose a confirmable
plan, and is not eligible for a Chapter 7 discharge.
The secured creditors tell the Court that it would not be
appropriate to dismiss the Debtor's case until after they complete
their foreclosure on the real property located at 500 Hegenberger
Road, Oakland, California.
Secured creditors tell the Court that the foreclosure sale is now
set for February 25, 2009. Secured creditors say that they are
concerned that the dismissal of the case will just permit the
Debtor to further delay the foreclosure by either filing another
bankruptcy case or by transferring the real property to another
entity who will file bankruptcy.
Oakland, Calif.-based U-Safe Investments, LLC filed for Chapter 11
relief on Oct. 14, 2008 (Bankr. N.D. Calif. Case No. 08-45880).
Fayedine Coulter, Esq, at the Law Offices of Fayedine Coulter, and
Marc Voisenat, Esq., at the Law Offices of Marc Voisenat,
represent the Debtor as counsel. In its schedules, the Debtor
listed total assets of $27,462,062, and total debts of
$18,025,256.
VERASUN ENERGY: Selects Valero's $477MM Bid for 7 Facilities
------------------------------------------------------------
VeraSun Energy Corp. has selected Valero Renewable Fuels as the
successful bidder for assets contained in the "VSE Group", in
addition to ethanol production facilities in Albion, Nebraska, and
Albert City, Iowa, following an auction in Wilmington, Delaware.
The secured lenders submitted successful credit bids for each of
the remaining facilities.
The VSE Group consists of production facilities in Aurora, South
Dakota; Charles City, Fort Dodge and Hartley, Iowa, and Welcome,
Minnesota, and a development site in Reynolds, Indiana.
Upon the conclusion of the auction, VeraSun selected Valero as the
successful bidder to purchase the VSE Group facilities for a base
purchase price of $350 million, $72 million for the US Bio Energy
facility in Albert City, Iowa and $55 million for the ASA facility
in Albion, Nebraska, plus working capital and other certain
adjustments.
The secured lenders for the remaining facilities submitted
successful credit bids. Dougherty Funding, LLC submitted a credit
bid of $93 million for the Marion, S.D. production facility. A
group of lenders led by AgStar Financial Services submitted a
credit bid of $324 million for the remaining "US BioEnergy Group",
which includes ethanol production facilities in Central City and
Ord, Neb.; Dyersville, Iowa; Hankinson, N.D.; Janesville, Minn.,
and Woodbury, Mich. A group of lenders led by West LB AG submitted
a credit bid of $99 million for the remaining "ASA Group"
facilities, consisting of production facilities in Bloomingburg,
Ohio and Linden, Ind.
VeraSun will seek approval of the successful bids at a sale
hearing conducted by the US Bankruptcy Court today, March 18, 2009
at noon. The sales are expected to close in April.
About VeraSun Energy
Headquartered in Sioux Falls, South Dakota, VeraSun Energy Corp.
-- http://www.verasun.comor http://www.VE85.com/-- produces and
markets ethanol and distillers grains. Founded in 2001, the
company has a fleet of 16 production facilities in eight states,
with 14 in operation.
The company and its debtor-affiliates filed for Chapter 11
protection on Oct. 31, 2008, (Bankr. D. Del. Case No. 08-12606)
Mark S. Chehi, Esq. at Skadden Arps Slate Meagher & Flom LLP
represents the Debtors in their restructuring efforts.
AlixPartners LLP serves as their restructuring advisor. Rothschild
Inc. is their investment banker and Sitrick & Company is their
communication agent. The Debtors' claims noticing and balloting
agent is Kurtzman Carson Consultants LLC. The Debtors'
total assets as of June 30, 2008, was $3,452,985,000 and their
total debts as of June 30, 2008, was $1,913,214,000.
VeraSun Bankruptcy News; Bankruptcy Creditors' Service Inc.;
http://bankrupt.com/newsstand/or 215/945-7000).
VISIPHOR CORP: Assets Sold, All Staff Laid Off
----------------------------------------------
Visiphor Corporation said Quorum Secured Equity Trust and Quorum
Investment Pool Limited Partnership have completed execution of
enforcement of their security interest in the Company's assets and
have acquired and disposed of all of the Company's assets.
As a result, Visiphor has laid off all staff and ceased business
operations.
Visiphor said the sale only settles a portion of its obligations
to the secured creditors. It remains indebted to the secured
creditors for $4 million and to the unsecured creditors for
$1.7 million.
In November 2008, Visiphor received demands for payment and
notices of intention to enforce security from Quorum. The Company
tried to negotiate a possible standstill agreement in which Quorum
would hold off on exercising any rights during the standstill
period.
Visiphor also disclosed that Sunil Amin, its Chief Financial
Officer, has tendered his resignation effective immediately.
The Company has not declared bankruptcy and retains significant
tax losses carried forward. The Company's board in cooperation
with creditors will investigate a possible tax loss sale.
Based in Vancouver, Canada, Visiphor Corporation (OTCBB: VISRF;
TSX-V: VIS; DE: IGYA) provides software products and services that
integrate business processes and databases. The Company's
solutions focus on disparate process and data management problems.
W.R. GRACE: District Court Drops N.J. Suit After Bar Date Missed
----------------------------------------------------------------
A bankruptcy filing triggers an injunction against the continuance
of any action by any creditor against the debtor or the debtor's
property.
Judge Ronald L. Buckwalter of the U.S. District Court for the
District of Delaware said that while the "automatic stay" under
Section 362 of the Bankruptcy Code bars actions by creditors, he
noted that the law contains an exception permitting governments to
enforce their police and regulatory powers. The judge held that a
civil suit to impose a penalty for polluting is among the type of
actions not stopped by bankruptcy.
This exception, however, did not affect the outcome. According to
Bloomberg's Bill Rochelle, Judge Buckwalter allowed W.R. Grace &
Co. to stop New Jersey environmental regulators in their tracks
because they failed to file a claim by the claims bar date and
therefore wouldn't be able to collect a fine even if they won the
suit in state court for making false statements.
According to Mr. Rochelle, the loss was the second for the New
Jersey regulators. One year ago this month, Judge Buckwalter
ruled in favor of Grace in another appeal where he held that
missing the claim-filing cutoff date by four years wasn't
excusable neglect.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
The Debtors filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement. The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005. The
Debtors' exclusive period to file a chapter 11 plan expired on
July 23, 2007. Estimation of W.R. Grace's asbestos personal
injury liabilities commenced on Jan. 14, 2008.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
WASHINGTON MUTUAL: Claim Rejected by FDIC, Equity Group Says
------------------------------------------------------------
The Washington Mutual Equity Group, composed of Washington
Mutual, Inc. shareholders, noted in an online discussion that
Weil Gotshal & Manges LLP, the Debtors' lead counsel, filed a
"proof of claim" with the Federal Deposit Insurance Corporation
on December 30, 2008. The Group reported that the FDIC rejected
the Claim at the end of January 2009.
The Shareholders said that according to Tal S. Sapeika, Esq., at
Weil Gotshal, the firm had 60 days to file a lawsuit against the
FDIC on account of WaMu's Disallowed Claim. In this regard, the
Shareholders expect that a lawsuit prosecuting the Claim will be
initiated in the U.S. Bankruptcy Court for the District of
Delaware or in a separate court in late March 2009.
The WaMu Equity Group previously stated that they seek to
preserve the maximum value of WaMu's estate and to ensure that
shareholder interests are addressed. The Group also seeks to
obtain legal representation in WaMu's bankruptcy proceedings.
Details on the WaMu Equity Group discussions may be accessed at:
http://www.wamurape.org/wamurape.aspx?g=posts&t=643
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous
non-bank subsidiaries. The company operates in four segments: the
Retail Banking Group, which
operates a retail bank network of 2,257 stores in California, Florida,
Texas, New York, Washington,
Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada,
Utah, Idaho and Connecticut;
the Card Services Group, which operates a nationwide credit card
lending business; the
Commercial Group, which conducts a multi-family and commercial real
estate lending business in
selected markets, and the Home Loans Group, which engages in
nationwide single-family
residential real estate lending, servicing and capital markets activities.
Washington Mutual Bank was taken over Sept. 25 by U.S. government
regulators. The next day, WaMu and its debtor-affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns
100% of the equity in WMI Investment. Weil Gotshal & Manges
represents the Debtors as counsel. When WaMu filed for protection
from its creditors, it listed
assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment
listed assets of
$500,000,000 to $1,000,000,000 with zero debts.
(Washington Mutual Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or
215/945-7000)
WASHINGTON MUTUAL: Seeks Approval of Lease Rejection Guidelines
---------------------------------------------------------------
Washington Mutual, Inc., and WMI Investment Corp. have begun their
review of non-residential
real property leases and executory contracts. They ask the U.S.
Bankruptcy Court for the District
of Delaware to establish procedures for the rejection of leases and contracts.
The Debtors are parties to hundreds of executory contracts and
unexpired leases with vendors, who lease property, perform
services, deliver goods, or license software. The Debtors say
many of the Contracts and Leases were for the benefit of the
banking operations formerly owned by Washington Mutual Bank, and
very few of those, if any, provide any benefit to their estates.
The Debtors have evaluated their assets for ultimate distribution
to creditors, and they ascertained that they will continue to
review from time to time "drop out" notices received from
JPMorgan Chase, which are issued in accordance with the Court-
approved stipulation by and between the Debtors and JPMorgan
Chase concerning Vendor Contracts.
The purpose of the Vendor Stipulation was to facilitate the
transfer of the Vendor Services to JPMorgan Chase, pursuant to
which JPMorgan Chase is required to pay for all postpetition fees
and expenses associated with the services that benefit Washington
Mutual Bank's operations, Mark D. Collins, Esq., at Richards,
Layton & Finger, P.A., in Wilmington, Delaware, reminds the
Court. However, upon 20 days' of the Drop Out Notice to the
Debtors, JPMorgan Chase may elect to stop paying for Vendor
Services that it no longer needs.
If the Debtors ascertain that they no longer need that the
Contracts and Leases and those Contracts cannot be assumed and
assigned to a third party for value, then those Contracts and
Leases need to be rejected.
Mr. Collins relates that JPMorgan Chase has sent two Drop Out
Notices with respect to more than 100 Contracts and Leases, some
of which require immediate rejection to avoid any argument that
the Debtors' estates are incurring any administrative expense.
By this motion, the Debtors seek the Court's approval of their
proposed expedited procedures to efficiently implement future
Contracts and Leases Rejections and to avoid otherwise
significant administrative costs in connection with those
Rejections.
The Expedited Rejection Procedures provide that:
(a) The Debtors will file with the Court a Rejection Notice
relating their intent to reject any Contract or Lease, to
be served on these Rejection Notice Parties:
* Counterparties affected by the Rejection Notice,
* The Official Committee of Unsecured Creditors,
* The U.S. Trustee, and
* Other parties-in-interest.
Any Contract or Lease that is the subject of a Rejection
Notice will be deemed subject to a motion to reject the
Contract or Lease pursuant to Section 365 of the
Bankruptcy Code.
(b) The Rejection Notice will set forth:
-- a description of the Contract or Lease that will be
rejected,
-- the name and address of the affected counterparties,
-- a description of the deadlines and procedures for
filing objections to the Rejection Notice, and
-- the proposed order approving the Rejection.
(c) Parties-in-interest that wish to object to the Proposed
Rejection must file and serve with the Court a formal
written objection no later than 10 days after the date
the Debtors served the Rejection Notice.
(d) If no timely objection is filed and served with respect to
a Rejection Notice, the Debtors will file with the Court a
certificate of no objection along with a Rejection Order.
The Rejection Order will provide, inter alia, that the
rejection of that Contract or Lease will be deemed
effective as of the Rejection Date.
(e) If a timely objection is properly filed and served on the
Debtors and the Rejection Notice Parties, the Debtors will
schedule a hearing to consider the objection. If the
objection is overruled by the Court or withdrawn, the
Rejection will be deemed effective either (i) as of the
Rejection Date, or (ii) as otherwise determined by the
Court.
(f) If the Debtors have deposited amounts with a Lease or
Contract counterparty as a security deposit or other
arrangement, Lease or Contract counterparties may not set
off or recoup or otherwise use the Deposit without the
Court's approval.
(g) Any affected lessor or counterparty or any other party-
in-interest that asserts a claim or claims against the
Debtors must submit a proof of claim to on or before the
later of (i) the date that is 30 days after the date of
the Rejection Order, or (ii) the General Claims Bar Date
established on March 31, 2009. Absent a timely filed
claim, a claimant will be forever barred from asserting a
claim for rejection damages.
Mr. Collins contends that the Rejection Procedures will
streamline the Debtors' ability to reject burdensome Contracts
and Leases that provide no benefit to their estates and thereby,
minimize unnecessary postpetition obligations. Furthermore, the
Procedures will provide Contract and Lease counterparties with
adequate notice of the Rejections and an opportunity to object
within a reasonable time period.
Debtors Seek to Reject 96 Contracts
Pursuant to sections 105(a) and 365 of the Bankruptcy Code, the
Debtors determined that 96 various services, purchase and license
agreements provide no additional benefit to their estates, and
would represent potentially significant liabilities.
A complete list of the Executory Contracts to be rejected is
available for free at:
http://bankrupt.com/misc/WaMu_96RejectedContracts.pdf
The Debtors believe that rejection of the 96 Contracts is
warranted.
Judge Mary F. Walrath will convene a hearing on March 27, 2009, to
consider approval of the
Debtors' request. Objections, if any, must be filed by March 20.
Meanwhile, Judge Walrath authorized the Debtors to assume and assign
two of their lease
agreements to JPMorgan Chase. The Leases are with respect to:
-- about 20 parking spaces located at 2500 PGA Boulevard, in
Palm Beach Gardens, Florida; and
-- a 7,400 sq. ft. property located at 1870 Aloma Avenue, in
Winter Park, Florida.
Pursuant to the Palm Beach Assignment Agreement and the Winter
Park Assignment Agreement, the Debtors will have no further
obligations under the Leases.
WaMu Layoffs "Mostly Done," JPMorgan Says
Jamie Dimon, CEO of JPMorgan Chase, confirmed in an interview
with Kirsten Grind of the Puget Sound Business Journal that the
job cuts of Washington Mutual employees his company contemplated
are "mostly done."
"I could say we saved 30,000 jobs as opposed to 12,000 layoffs,"
Mr. Dimon told Ms. Grind. "When you do a big deal like this you
have to get it to the right size so you can be vibrant and
healthy and grow in the future. It's highly unfortunate, we hate
doing it, but it is the right thing to do so you can build the
company from there," he said.
JPMorgan Chase & Co. has said that it planned to eliminate an
additional 2,800 Washington
Mutual Bank positions, through attrition, bringing the total number of
job cuts to 12,000 since
JPMorgan's acquisition of WMB in September 2008. The series of
countrywide lay-offs started in
December 2008, affecting WMB employees in Washington, Florida, and
California, among other
states.
According to Mr. Dimon, JPMorgan is not phasing out any of WaMu's
business segments, but is "converting the systems sometime in the
second quarter . . . with brand new hardware systems, far more
products and far more services."
Mr. Dimon further disclosed to the newspaper that JPMorgan is
continuing WaMu's commercial lending group, but will discontinue
the mortgage broker business. It also won't be offering the
subprime card WaMu maintained.
Mr. Dimon noted that WaMu's failure "is very painful for people"
but he is optimistic that with JPMorgan's acquisition of the
Bank, it "is going to be a great bank for Washington and
Seattle."
"It's not going to be overnight," the news source quoted Mr.
Dimon as saying. "The signs will change, the system will change
and we're going to train the people" he concluded.
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous
non-bank subsidiaries. The company operates in four segments: the
Retail Banking Group, which
operates a retail bank network of 2,257 stores in California, Florida,
Texas, New York, Washington,
Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada,
Utah, Idaho and Connecticut;
the Card Services Group, which operates a nationwide credit card
lending business; the
Commercial Group, which conducts a multi-family and commercial real
estate lending business in
selected markets, and the Home Loans Group, which engages in
nationwide single-family
residential real estate lending, servicing and capital markets activities.
Washington Mutual Bank was taken over Sept. 25 by U.S. government
regulators. The next day, WaMu and its debtor-affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns
100% of the equity in WMI Investment. Weil Gotshal & Manges
represents the Debtors as counsel. When WaMu filed for protection
from its creditors, it listed
assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment
listed assets of
$500,000,000 to $1,000,000,000 with zero debts.
(Washington Mutual Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or
215/945-7000)
WASHINGTON MUTUAL: To Sell Venture Capital Stake for $3.1MM
-----------------------------------------------------------
Washington Mutual, Inc., and WMI Investment Corp. notified the U.S.
Bankruptcy Court for the
District of Delaware that they intend to sell their limited
partnership interests with related capital
commitments in six Venture Capital Funds for $3,166,314.
VC Fund Purchase Price
------- --------------
ARCH Venture Fund V, L.P. $1,577,409
Arrowpath Commerce Fund II, L.P. 454,618
Digital Partners III, L.P. 39,291
Madrona Venture Fund I-A 656,651
Madrona Venture Fund III 57,265
Maveron Equity Partners 2000 381,081
The Debtors will sell the VC Funds to Industry Ventures Fund V,
L.P., which is a limited partner in certain of the VC Funds, free
and clear of all liens under Section 363(f) of the Bankruptcy
Code.
In addition to the $3,166,314 cash purchase price, Industry
Ventures Fund has agreed to assume the Debtors' unfunded
commitments with respect to the VC Funds for $1.7 million. As
of September 30, 2008, the Debtors' aggregate capital account
balance for the VC Funds was $7.1 million, according to Mark D.
Collins, Esq., at Richards, Layton & Finger, P.A., in Wilmington,
Delaware, tells the Court.
Pursuant to the VC Purchase and Sale Agreement, the contemplated
purchase and the sale of the Interests will take place at the
closing date, or three days after the later to occur of:
(a) the date on which all the Closing Deliveries have been
made, which include the Debtors' delivery to Industry
Ventures Fund of:
-- a Transfer Agreement which is executed by the
Debtors, and provides for the consent of the
Debtors' general partner to the assignment and
transfer of the Interest in the Partnership;
-- a Court order approving the Sale, and entitling
Industry Ventures Fund of the protection afforded by
Section 363(m) of the Bankruptcy Code;
-- all other documents relating to the Sale; or
(b) the Debtors' compliance with the Court-approved Notice and
Objection Procedures.
The Agreement further provides that with respect to each
Partnership, the Purchase Price will be:
(i) increased by an amount equal to the aggregate
contributions to the capital of the Partnership during
the period beginning on September 30, 2008, and ending on
the Closing Date; and
(ii) reduced by an amount equal to the aggregate distributions
received by the Debtors from the Partnership from
September 30, 2008 to the Closing Date. Any Distribution
other than cash and cash equivalents will be valued at
the value placed on the property by the general partner
of the Partnership at the time of the Distribution.
A full-text copy of the VC Purchase Pact is available for free
at: http://bankrupt.com/misc/WaMU_VCPurchaseAgreement.pdf
In a statement to the Puget Sound Business Journal, Industry
Ventures Fund said its purchase of WaMu's VC portfolio "is a
signal of assurance to General Partners and the venture-backed
companies they support that the secondary market is here to
support their capital needs and businesses."
According to Industry Ventures Fund, the VC Purchase is an
example of how secondary funds are deploying capital and
executing deals during a very difficult market environment. "In
these challenging economic times, there is an increased need to
provide stability to the markets, and in particular to venture
capital funds," the Company added, according to the report.
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous
non-bank subsidiaries. The company operates in four segments: the
Retail Banking Group, which
operates a retail bank network of 2,257 stores in California, Florida,
Texas, New York, Washington,
Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada,
Utah, Idaho and Connecticut;
the Card Services Group, which operates a nationwide credit card
lending business; the
Commercial Group, which conducts a multi-family and commercial real
estate lending business in
selected markets, and the Home Loans Group, which engages in
nationwide single-family
residential real estate lending, servicing and capital markets activities.
Washington Mutual Bank was taken over Sept. 25 by U.S. government
regulators. The next day, WaMu and its debtor-affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns
100% of the equity in WMI Investment. Weil Gotshal & Manges
represents the Debtors as counsel. When WaMu filed for protection
from its creditors, it listed
assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment
listed assets of
$500,000,000 to $1,000,000,000 with zero debts.
(Washington Mutual Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or
215/945-7000)
WASHINGTON MUTUAL: Wants Insurers to Pay ERISA Suit Defense Costs
-----------------------------------------------------------------
Washington Mutual, Inc., and WMI Investment Corp. ask the U.S.
Bankruptcy Court for the
District of Delaware to modify the automatic stay pursuant to Section
362(d) of the Bankruptcy
Code to allow advancement or payment by third party insurance
companies of defense costs
previously incurred, presently being incurred, or will be incurred, by
present and former directors
and former officers of Washington Mutual, Inc., in connection with
these matters:
1. The WaMu ERISA Litigation, pending in the U.S. District
Court for the Western District of Washington
2. The action, Buus v. WaMu Pension Plan, pending in the U.S.
District Court for the Western District of Washington
3. Subpoenas for Records Directed to WaMu Savings Plan and
Washington Mutual, Inc., as initiated by the U.S.
Department of Labor
Mark D. Collins, Esq, at Richards, Layton & Finer, P.A., in
Wilmington, Delaware, relates that certain of WaMu's former and
current directors and officers are the individual defendants in
the ERISA Litigation. The Buus Litigation involves the WaMu
Mutual Pension Plan Administration Committee, which is comprised
of individuals appointed by WaMu, while the Department of Labor
Subpoenas were served to WaMu in connection with the WaMu Savings
Plan.
The Defendants in the Litigations and the Department of Labor
Subpoenas have incurred, and will continue to incur, defense
costs and fees, which, as a result of the Chapter 11 petition,
WaMu is no longer able to satisfy in accordance with its
indemnification obligations, Mr. Collins notes.
In this regard, the Debtors contend that confirming the ability
of their insurers to pay the Defense Costs and Fees in connection
with the Litigations and the Department of Labor Subpoena will
relieve their estates of the potentially significant burden of
claims that would otherwise be made against them by the
Individual Defendants.
The WaMu Insurance Policies
Mr. Collins elaborates that certain claims made against the
Individual Defendants in the ERISA and Buus Litigation and the
Department of Labor Subpoena have been tendered to the Washington
Mutual Financial Institution Blended Program. Certain
Underwriters at Lloyd's, London are the underwriters for the $25
million primary policy of the Washington Mutual Financial
Institution Blended Program.
He adds that the 2007/2008 Primary Lloyd's Policy is the primary
policy in a "tower" of related insurance policies. The other
Policies in the tower generally follow form to the Primary Policy
and increase potential coverage for the ERISA Litigation of up to
$75 million.
The Policies provide insurance coverage for, among other matters,
defense fees and related expenses incurred in defending covered
claims against the "Insureds."
Mr. Collins clarifies that the proceeds of the Policies are not
exclusively property of the Debtors' estate. However, under the
terms of the 2007/2008 Primary Lloyd's Policy, the Debtors are
entitled to collect Policy proceeds, and have the exclusive
authority to request that the carriers apply the order provisions
in the Policy.
In light of the Debtors' cases, "the depletion of proceeds to pay
the [c]osts of [d]efense [i]ncurred by the officers and
directors] does not diminish the protection afforded the estate's
assets under the terms of the Policy," Mr. Collins maintains,
citing In re Laminate Kingdom LLC. No. 07-10279-BKC-AJC, 2008 WL
1766637, at *3 (Bankr. S.D. Fla. Mar. 13, 2008).
To the extent that the Defense Costs and Expenses are paid by
insurance, the Claims seeking to recover them will be addressed
without depleting the assets of the Debtors' estates, Mr. Collins
maintains. Moreover, relieving the Individual Defendants of the
Defense Costs and Expenses will allow them to focus their efforts
fully in the administration of the Chapter 11 cases for the
benefit of the creditors, Mr. Collins points out.
Mr. Collins clarifies that the Debtors' request seeks only a
modification of the Stay to allow the insurers to fulfill their
obligations, whatever they may be, to pay claims and expenses
pursuant to the Policies.
The Individual Defendants have agreed to provide information to
WaMu and its creditors regarding the ongoing status of the ERISA
Litigation. This will allow WaMu's creditors to monitor how the
Insurance Proceeds are being used, Mr. Collins affirms.
Judge Mary F. Walrath will convene a hearing on April 23, 2009, to
consider the Debtors' request.
Objections, if any, must be filed by March 27.
About Washington Mutual
Based in Seattle, Washington, Washington Mutual Inc. --
http://www.wamu.com/-- is a holding company for Washington Mutual
Bank as well as numerous
non-bank subsidiaries. The company operates in four segments: the
Retail Banking Group, which
operates a retail bank network of 2,257 stores in California, Florida,
Texas, New York, Washington,
Illinois, Oregon, New Jersey, Georgia, Arizona, Colorado, Nevada,
Utah, Idaho and Connecticut;
the Card Services Group, which operates a nationwide credit card
lending business; the
Commercial Group, which conducts a multi-family and commercial real
estate lending business in
selected markets, and the Home Loans Group, which engages in
nationwide single-family
residential real estate lending, servicing and capital markets activities.
Washington Mutual Bank was taken over Sept. 25 by U.S. government
regulators. The next day, WaMu and its debtor-affiliate, WMI
Investment Corp., filed separate petitions for Chapter 11 relief
(Bankr. D. Del. 08-12229 and 08-12228, respectively). Wamu owns
100% of the equity in WMI Investment. Weil Gotshal & Manges
represents the Debtors as counsel. When WaMu filed for protection
from its creditors, it listed
assets of $32,896,605,516 and debts of $8,167,022,695. WMI Investment
listed assets of
$500,000,000 to $1,000,000,000 with zero debts.
(Washington Mutual Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service Inc.; http://bankrupt.com/newsstand/or
215/945-7000)
WENDY'S/ARBY'S GROUP: S&P Affirms 'B+' Corporate Credit Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services said it affirmed the 'B+'
corporate credit rating on Atlanta-based quick-service restaurant
operator Wendy's/Arby's Group Inc. and its subsidiary Wendy's
International Inc. S&P removed the ratings from CreditWatch with
negative implications, where they were placed March 2, 2009. At
the same time, S&P raised the rating on Arby's Restaurant Group
Inc. two notches to 'B+' from 'B-' and removed the ratings from
CreditWatch with developing implications, where they were placed
on March 2, 2009. The outlook is stable.
These rating actions follow Arby's amending its senior secured
credit facility. Under the amended facility, Wendy's
International Holdings LLC, the parent of Wendy's and subsidiary
of Wendy's/Arby's, and Wendy's were added as co-borrowers of the
credit facility. The amendment gives the company considerable
cushion over financial covenants of the facility, since it now
reports covenant metrics on a consolidated basis. "This should
ensure that both operating subsidiaries have adequate financial
flexibility and liquidity in the near term," explained Standard &
Poor's credit analyst Charles Pinson-Rose, "and should ensure that
both operating subsidiaries have adequate financial flexibility
and liquidity in the near term."
WEST PENN: Moody's Affirms 'Ba3' Rating on $752 Mil. Bonds
----------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 rating on West Penn
Allegheny Health System's $752 million of Series 2007 fixed rate
bonds issued through the Allegheny County Hospital Development
Authority. The outlook remains negative.
At this time, the affirmation is based on the progress WPAHS has
made in implementing improvement initiatives identified with the
assistance of consultants, exceeding budgeted operating income for
the first six months of fiscal year 2009, and the maintenance of
unrestricted cash levels. Management is budgeting for fiscal year
2009 a large reduction in the operating loss in fiscal year 2008
and modest growth in unrestricted cash levels at fiscal yearend
2009.
However, maintenance of the negative outlook reflects the
significant challenges the system still faces in the near-term and
the risk of a downgrade if budgeted operating targets are not met
or if the system is unable to respond to unexpected setbacks.
Moody's believe the system's primary challenges are: (1) fully
implementing improvement initiatives and achieving operating
budgets; (2) at least maintaining current unrestricted cash levels
given the volatility and uncertainty of investment returns; (3)
retaining and recruiting physicians as the organization
restructures physician groups and consolidates leadership; and (4)
meeting volume projections given a weaker economy, recent and
potential physician turnover and competition.
Legal Security: Joint and several obligation of the Obligated
Group with mortgage lien on certain real property, including the
primary hospital facilities, and gross revenue pledge; debt
service reserve fund present; limitations on additional
indebtedness and withdrawal from obligated group permitted if a
combination of certain coverage and financial ratio tests are met.
Days cash on hand covenant liberal with definition including
project funds.
Interest Rate Derivatives: None
Strengths
* Progress on implementing turnaround initiatives beyond initial
targets and ability to exceed budget for two quarters of fiscal
year 2009
* System's prominence as the second largest healthcare system in
Pittsburgh with almost 80,000 admissions
* Moderate pension funding needs in the next two years following
several years of significant cash funding above expense levels,
although unfavorable investment returns could result in a large
funding requirement in fiscal year 2011
* Favorable debt structure with all fixed rate debt and no
interest rate derivatives
Challenges
* Large operating loss in unaudited fiscal year 2008 of $89
million which, while affected by a sizable accounts receivable
writeoff, reflects substantial operating challenges; modest
cashflow from operations
* Weak unrestricted cash position of 39 days of cash on hand as of
December 31, 2008 (excluding trustee-held project funds), which
has been maintained since fiscal yearend 2008 (at 37 days)
* Although admissions are up 2% the half of fiscal year 2009,
volume trends have been mixed with declines in some more
profitable services in part due to physician turnover and
volumes are softening; physician departures are a risk as the
system restructures and consolidates physician organizations
* Heavy competition from UPMC Health System, which is the largest
health system in the region and owns a large managed care plan,
enabling UPMC to control health plan membership and volumes
* Dependency on Highmark, the largest insurer in the region, for
approximately 38% of system revenues including Highmark and
Highmark Medicare Security Blue products
* High leverage relative to operating performance with weak
maximum debt service coverage of under one times in 2008;
sizable capital needs have been deferred and are necessary to
remain competitive
* Challenging demographic service area with declining population
trends in the primary service area and an aging patient base
Recent Developments/Results
Our rating review is being done in conjunction with West Penn's
release of its second quarter (ended December 31, 2008) fiscal
year 2009 results, which represents an additional quarter of
information since Moody's last review in November 2008.
Second quarter and year-to-date results indicate that West Penn is
making progress on implementing turnaround initiatives and that
unrestricted cash has been maintained. However, the system is
early in its turnaround and will continue to face significant
challenges for some time; Moody's greatest concern is maintaining
and growing volumes, which have begun to soften.
West Penn exceeded its budget in both the first and second
quarters. Revenue was above budget and most expense items were
below budget. Year-to-date, the operating loss was $26.4 million
(-3.3%), with the operating loss in the second quarter
($10.1 million) showing improvement over the first quarter
($16.3 million). Comparisons to prior year are not meaningful
because of a large receivables adjustment at the end of the year.
Operating cashflow year-to-date was $29.6 million, a weak 3.7%.
The early improvement and excess over budget reflects better
collections from revenue cycle initiatives and cost reductions
that exceed original targets.
West Penn's audit for fiscal year 2008 has not been completed,
although management has provided unaudited statements. Since the
release of unaudited statements, management has announced some
anticipated adjustments to fiscal year 2008 results, although
these adjustments are not significant. West Penn's unaudited
fiscal year 2008 results reflect the system's significant
operating challenges going into 2009. The operating loss in
fiscal year 2008 was $89 million, which includes a total of
$68 million in adjustments and writeoffs, of which $62 million
relates to accounts receivable. Approximately $18 million relates
to prior years, suggesting that prior year income levels were
overstated. Operating cashflow in 2008 was a weak $18 million.
Excluding the prior year portion of the adjustment, the operating
loss in 2008 was still substantial and largely reflects the "true"
run rate for the system. While it is difficult to compare to the
prior year, the higher loss is primarily due to increased
uncompensated care ($20 million increase), increased costs for
physician employment and other professional fees and a decline in
surgical volume.
WPAHS, under a new management team, engaged Wellspring in 2008 as
its primary consultant to assist in turnaround initiatives.
Wellspring originally identified $66 million in annual savings (as
a mid-point), including $37 million that would benefit fiscal year
2009. As of December 31, 2008 approximately $90 million of
initiatives have been implemented as the system identifies further
savings. Savings are expected to come from labor, revenue cycle,
supplies and other non-labor areas. As a result, the system is
budgeting substantial improvement to a $41 million operating loss
(which includes $18 million in non-recurring professional fees)
and $73 million in operating cashflow.
Volume trends in the first and second quarters have been mixed and
are beginning to show softness. Additionally, Moody's believe
there is risk in being able to retain and recruit physicians as
the organization pursues restructuring initiatives. For the six
months year-to-date, total system admissions increased 2% over
last year and were on budget. However, while the first quarter
admissions exceeded budget, the second quarter was 1.6% under
budget. Allegheny General and Forbes are both experiencing
volumes trends about budget and prior year, while West Penn,
Cannonsburg and AlleKiski are below budget and prior year. By
service line, the system is experiencing declines in more
profitable services, including cardiology and general surgery, and
growth in less profitable services, including medical.
Difficulties in cardiology is due to competition and changes in
technology. Outpatient surgeries declined by 2.4% through the six
months of 2009 in part due to the departure of surgeons from West
Penn Hospital. Moody's believe further physician turnover is
possible as the system restructures and consolidates physician
entities and leadership. The system budgeted a 1.4% growth in
admissions in 2009 and is depending on the recruitment of
physicians to bolster revenue, which could be ambitious.
West Penn's unrestricted cash position is weak, although it has
been stabilized through the six months of fiscal year 2009 after a
substantial decline in 2008. As of June 30, 2008 unrestricted
cash was $156 million (37 days of cash on hand). As of
December 31, 2008, unrestricted cash was $171 million (39 days of
cash on hand). The system's ability to maintain cash, despite
large losses, was driven by low capital spending ($21 million),
minimal pension funding, a net investment gain of $4.3 million and
the release of funds from an insurance captive ($6.3 million).
Unrestricted cash is budgeted to be $179 million as of fiscal
yearend June 30, 2009. Although West Penn's asset allocation is
fairly conservative, Investment returns could affect the ability
to maintain cash. The system's board designated assets (which
comprise about half of total unrestricted cash) are invested
approximately 20% in equities and the remainder in fixed income.
So effectively under 10% of total unrestricted cash is exposed to
equities.
By definition, Moody's calculation of unrestricted cash does not
include project funds from bond proceeds because these funds are
trustee held and are expected to be used for projects (West Penn's
covenant includes project funds). West Penn has $78 million in
project funds, some of which may be used in fiscal year 2009 but
are designated to be used for long-lived assets.
The system is significantly scaling back on capital spending to
preserve cash and is budgeted to spend $51 million in fiscal year
2009. Pension funding is low in fiscal year 2009, manageable in
fiscal year 2010, but could increase significantly in 2011,
depending on investment returns. West Penn's pension fund
currently has a relatively high allocation to equities.
WestPenn continues to operate in a challenging competitive and
payer market. West Penn competes with UPMC Health System, which
maintains a leading market position. Highmark is the dominant
insurer in the region, accounting for approximately 38% of
WestPenn's revenues (including Highmark and Highmark Medicare
Security Blue products). This dominance affords Highmark
significant negotiating leverage with WestPenn as well as other
providers in setting managed care rates. The second largest
health plan in the area is UPMC's health plan, which does not
contract with WestPenn.
Outlook
The negative outlook reflects the significant challenges the
system still faces in the near-term and the risk of a downgrade if
budgeted operating targets are not met or if the system is unable
to respond to unexpected setbacks. Moody's believe the system's
primary challenges are: (1) fully implementing improvement
initiatives and achieving operating budgets; (2) at least
maintaining current unrestricted cash levels given the volatility
and uncertainty of investment returns; (3) retaining and
recruiting physicians as the organization restructures physician
groups and consolidates leadership; and (4) meeting volume
projections given a weaker economy, recent and potential physician
turnover and competition.
What could change the rating-UP
With a negative outlook, a rating upgrade in the near-term is not
likely. Long-term, an upgrade would be considered with sustained
improvement in operating cashflow for several years, significant
growth in unrestricted cash and stability or growth in medical
staff and successful completion of physician restructuring
strategies.
What could change the rating-DOWN
Shortfall to budgeted fiscal year 2009 operating income and
operating cashflow; decline in unrestricted cash (excluding
project funds) below current levels
Key Indicators
Assumptions & Adjustments:
-- Based on financial statements for West Penn Allegheny Health
System
-- First number reflects audit year ended June 30, 2007
-- Second number reflects unaudited results for audit year ended
June 30, 2008
-- Investment returns smoothed at 6% unless otherwise noted
* Inpatient admissions: 78,832; 79,826
* Total operating revenues: $1.49 billion; $1.51 billion
* Moody's-adjusted net revenue available for debt service: $106.4
million; $27.7 million
* Total debt outstanding: $833 million; $830 million
* Maximum annual debt service (MADS): $53.9 million; $53.9 million
(excluding balloon payments in 2015 and 2016 related to a
financing for helicopters, which would increase MADS by
approximately $5 million and $3 million, respectively, in these
years)
* MADS coverage based on reported investment income: 2.2 times;
0.9 times
* Moody's-adjusted MADS coverage with normalized investment
income: 2.0 times; 0.5 times
* Debt-to-cash flow: 14.5 times; negative
* Days cash on hand (excluding project funds): 48 days; 37 days
* Cash-to-debt: 24%; 19%
* Operating margin: -1.1%; -6.0%
* Operating cash flow margin: 6.3%; 1.2%
The last rating action was on November 7, 2008 when the Ba3 rating
was confirmed and removed from Watchlist for potential downgrade
and a negative outlook was assigned.
WILLIAM TARSITANO: Case Summary & 19 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: William A. Tarsitano
8 Kensington Drive
North Barrington, IL 60010
Bankruptcy Case No.: 09-08722
Chapter 11 Petition Date: March 16, 2009
Court: Northern District of Illinois (Chicago)
Debtor's Counsel: Richard N. Golding, Esq.
rgolding@goldinglaw.net
Law Offices of Richard N Golding PC
The Boyce Building
500 North Dearborn St-Second Floor
Chicago, IL 60610
Tel: (312) 832-7885
Fax: (312) 755-5720
Estimated Assets: $1 million to $10 million
Estimated Debts: $10 million to $50 million
The Debtor's Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Harris NA property; $2,400,000
111 W Monroe Street secured:
Suite 12W $1,894,083
Chicago, IL 60603
Park National Bank property; $1,100,000
1026 Ogden Avenue secured: $860,000
Lisle, IL 60532
Parkway Bank machinery $550,000
4800 N. Harlem Avenue
Harwood Heights, IL 60706
Cornerstone Management pending lawsuit $550,000
Cook County, Illinois $189,700
Magnum Partners pending lawsuit $130,000
Eighteen Investments, Inc. fee $120,000
Lake County, Illinois $119,178
Riffner Barber $70,000
Heager Engineering judgment $55,000
Ford Credit vehicle $47,000
Planned Plumbing services $34,000
Citibank AA $27,606
Bank of America $ 25,574
Home Depot Credit Services $16,543
Chrysler Motor Credit vehicle $13,017
Citibank Gold Card $10,530
Village of Inverness fees $9,239
American Express $7,286
ZILA INC: Retains Advisors to Explore Options; Ch. 11 Possible
--------------------------------------------------------------
Zila Inc. disclosed that it has retained financial and legal
advisors to assist in restructuring its senior secured convertible
notes, raise capital and explore other strategic opportunities.
If the company is unable to obtain a solution to its debt, it will
likely be forced to file for protection under Chapter 11 of the
Federal Bankruptcy Code.
"We are making every effort to conserve our cash," said David
Bethune, chairman and chief executive officer of Zila. "We have,
among other things, continued salary reductions for a number of
management personnel, further reduced headcount throughout the
organization, eliminated the employee stock purchase plan and its
associated costs, furloughed certain manufacturing production
personnel, reduced the number of seminar programs and streamlined
the cost structure of these programs, and reduced tradeshow
expenditures. As a result of these cost cutting efforts, we
substantially narrowed our operating loss, excluding a non-cash
impairment charge for goodwill and other intangible assets
recorded in the fiscal 2009 second quarter."
Mr. Bethune continued: "In order to continue as an on-going
business and fund our operations over the next twelve months, we
will require additional funds and need to restructure our senior
secured convertible notes. We have had discussions with a number
of potential investors, all of whom have required, as a condition
of their investment, that the senior secured convertible notes be
repaid from the funds provided by the investor(s) and that this
repayment be at a substantial discount from the $12.0 million
principal outstanding to reflect what they believe to be the
current market value of those notes.
"Our business and its value have, in some measure, deteriorated
because of the lack of an agreement by the holders of the
company's senior secured convertible notes as to the value of the
notes. In addition, we have been unable obtain their approval to
pursue a working capital line of credit secured by our inventory
and accounts receivable, even though the note agreements provide
that such approval is 'not to be unreasonably withheld.'"
The company has made timely interest payments under the terms of
the senior secured convertible notes and is otherwise in
compliance with the terms of the notes, except for the interest
payment due January 31, 2009, which has not been made. The
company was unable to issue shares for the January 31, 2009,
interest payment because the issuance of the required number of
shares would have required shareholder approval under applicable
NASDAQ rules. In addition, given the company's current level of
cash and cash equivalents and the impact of the global economic
downturn on its business, the company may not have sufficient cash
available to pay its future quarterly interest payments due under
the senior secured convertible notes. The failure to make this
payment is an event of default under the senior secured
convertible notes. Although the company has not received a notice
of default or acceleration from the note holders, the company has
reclassified the senior secured convertible notes to current
liabilities.
As a result of the technical default and sales declines, the
company has substantial doubt about its ability to continue as a
going concern.
On Tuesday, Zila reported financial results for its fiscal 2009
second quarter ended January 31, 2009. Zila said net revenues
were $8.5 million compared with $10.5 million for the second
quarter of fiscal 2008. The company attributed the decline in
revenues primarily to the global economic downturn and customer
concern about its viability as an ongoing business. Zila said
gross profit was $4.7 million, or 56% of net revenues, compared
with $6.2 million, or 60% of net revenues, in the second quarter
of fiscal 2008. Including the non-cash impairment charge of
$23.2 million, net loss attributable to common stockholders was
$25.3 million, compared with $4.7 million for the second quarter
of fiscal 2008.
Net revenues were $18.2 million compared with $21.9 million
for six months ended January 31, 2009. Gross profit was
$10.6 million, or 58% of net revenues, compared with
$13.1 million, or 60% of net revenues, in the comparable period
of fiscal 2008. Net loss attributable to common shareholders --
which includes a non-cash impairment charge of $23.2 million --
was $28.1 million compared with $9.6 million in the year ago
period.
Zila Inc. and subsidiaries had $21.9 million in total assets and
$16.2 million in total liabilities as of January 31, 2009. Cash
and cash equivalents at January 31, 2009, were $2.5 million
compared with $4.5 million at July 31, 2008. The decrease
primarily reflects cash used in operations of $1.5 million, of
which $300,000 resulted from working capital changes.
A full-text copy of Zila's quarterly report on Form 10-Q is
available at no charge at: http://ResearchArchives.com/t/s?3a68
Based in Scottsdale, Arizona, Zila is a diagnostic company
dedicated to the prevention, detection and treatment of oral
cancer and periodontal disease. Zila manufactures and market
ViziLite(R) Plus with TBlue(R), its flagship product for the early
detection of oral abnormalities that could lead to cancer.
* S&P Says 125 Firms with $429.5-Bil. of Debt Defaulted in 2008
---------------------------------------------------------------
In full-year 2008, 125 companies rated by Standard & Poor's
Ratings Services (including 22 confidentially rated entities)
defaulted with $429.5 billion of debt, according to an article
published by Standard & Poor's Global Fixed Income Research. The
article, titled "2008 Default Synopses (Premium)," provides
summaries of the events leading up to each nonconfidential default
and, in some cases, the events following default.
* S&P Says Global Defaults Increases to 40 as of Mid-March 2009
---------------------------------------------------------------
Additional two issuers defaulted, bringing the 2009 year-to-date
tally of global corporate defaults to 40 issuers, said an article
published March 13 by Standard & Poor's.
Both of the defaulters are based in the U.S., bringing the totals
to 28 issuers in the U.S., six in emerging markets, two in Europe,
and four in the other developed region (Australia, Canada, Japan,
and New Zealand), according to the article, titled "Global
Corporate Default Update (March 6 - 12, 2009) (Premium)."
These nearly mirror the current standings of weakest links
(issuers rated 'B-' or lower with a negative outlook or ratings on
CreditWatch negative), which typically have the highest
preponderance of defaults. Currently, there are 265 weakest links
globally, 205 of which are based in the U.S., 28 in emerging
markets, 19 in Europe, and 13 in the other developed region.
Both of the defaults, plastic machinery equipment and industrial
fluids manufacturer Milacron Inc. and recreational vehicle and
factory-built housing maker Fleetwood Enterprises Inc., were the
results of Chapter 11 bankruptcy filings. Milacron has already
received commitments from two major bondholders and its revolving
credit facility lender for debtor-in-possession (DIP) financing to
continue funding its operations while it undergoes its
reorganization. Fleetwood Enterprises, on the other hand, is
still seeking a DIP financing provider.
"While both of this week's defaults were the results of
bankruptcies, which account for 37.5%, or 15 issuers, of total
defaults, the leading reason for defaults so far this year is
missed interest payments, with 42.5%, or 17 defaulted issuers,"
said Diane Vazza, head of Standard & Poor's Global Fixed Income
Research Group. The remaining defaults were the results of
distressed exchanges, amounting to 12.5%, or five issuers, and
other reasons accounted for 7.5% (or three issuers) of total
defaults.
* Fitch Issues Rating Criteria for Categorizing Issuers
-------------------------------------------------------
Fitch Ratings has released rating criteria for categorizing
whether an exchange proposed by an issuer is coercive in nature,
and therefore considered equivalent to a default.
Exchanges so classified would result in the issuer's IDR going to
'RD' upon consummation. While the criteria is similar to Fitch's
previously published version in 2006, the name of an exchange that
is considered by Fitch to be tantamount to a default has been
formally changed to a 'Coercive Debt Exchange' from a 'Distressed
Debt Exchange'.
This was done to reinforce the notion that there needs to be an
element of coercion present for the exchange to be considered a
default by Fitch, though the substance of the criteria has not
changed. Coercion to participate in an exchange can take the form
of an explicit threat of bankruptcy or other action that would be
to the clear detriment of creditors, or may be implicit in nature,
such that failure to participate would likely result in the issuer
filing for bankruptcy or otherwise failing. The latter can be a
very subjective determination. For an exchange or an amendment to
be considered a CDE, in addition to an element of coercion, the
proposed exchange needs to represent a material reduction in terms
from those that were contractually promised.
* Congress May Further Restrict Terms of Bail-Out
-------------------------------------------------
Brad Sherman, a Democratic congressman from California and a
senior member of the House Financial Services Committee, says that
to avert a modern depression, an "enormous, immediate stimulus" is
necessary. He says that in order to achieve these objectives,
federal dollars should be extended to private interests only on
the toughest terms. Taxpayers, he asserts, should demand the
highest yield, the largest equity upside, and the strictest limits
on executive compensation and perks.
"[B]y being tough on those obtaining bailouts, we can limit the
number of companies seeking a bailout," he says. If executives
see the federal government as a source of easy, cheap money, why
wouldn't they -- and every other company -- attempt to get a
bailout? The government does not have that kind of money.
Executive Compensation Hit
New York Attorney General Andrew Cuomo and House Financial
Services Committee Chair Barney Frank have sent a letter to Bank
of America Corp. Chief Executive Officer Kenneth Lewis asking him
to name the Merrill Lynch and Bank of America employees who raked
in $1 million or more in 2008 bonuses, according to a Bloomberg.
Merrill Lynch has been under fire for paying $3.6 billion in
bonuses to 700 employees just before its merger to BofA, despite
net losses of $27 billion for the company in 2008. BofA needed
the government's financial help in completing its acquisition of
ailing Merrill Lynch.
On February 4, the U.S. Treasury issued guidelines limit executive
compensation for firms that receive government assistance. The
guideline limits the total amount of compensation to no more than
$500,000 for senior executives except for restricted stock awards.
High Yield for Govt. Loans Pushed
According to Sherman, getting a good deal on our investments will
minimize the eventual increase in the federal debt, and the burden
it poses to succeeding generations. "Many of those companies
receiving bailout funds will still go bankrupt, so we must
generate profits on those that do not. We need to look at both
the rate of return on the preferred stock, and the value of the
warrants."
U.S. Senator Richard Shelby, the top ranking Republican on the
Banking Committee, told CNBC that letting banks fail would save
taxpayers money in the long run. "I don't think that there's any
institution other than the government that can't fail," Shelby
said, according to Bloomberg.
Mr. Sherman notes that when Warren Buffett invested in Goldman
Sachs, he got twice the rate of return and six times the warrants
as taxpayers received for a similar investment in the firm.
Bondholders May Be Asked to Take Losses
Owners of debt issued by U.S. financial firms might be asked to
take losses if the industry needs another bailout, according to a
Bloomberg report. Bloomberg, citing analysts, said that with
shareholders almost wiped out at banks like Citigroup and
lawmakers resisting more rescues, holders may be asked to swap
bonds for new debt that offers reduced interest rates or lower
face values.
"These banks can go into receivership, shed their shareholders,
shed or reduce the amount they owe to their bondholders and come
back out much stronger institutions," Mr. Sherman said.
According to Bloomberg, Citigroup Inc. and Bank of America Corp.'s
bond prices are sliding on concern that bondholders may be forced
to take losses. U.S. bank debt has lost 7.8 percent and yields
have jumped to record levels compared with benchmark rates in the
past month, even after taxpayers committed more than $11.6
trillion to prop up financial firms.
"The bond market is getting more scared every day," said Gary
Austin of PDR Advisors in Charlotte, North Carolina, who manages
$450 million in fixed-income securities. "At some time,
the government is going to say enough is enough, the only way we
will give you more cash is if the bondholders have to be hit."
* Hearing Held on 210-Day Lease Assumption Rule
-----------------------------------------------
According to Bloomberg's Bill Rochelle, a committee of the House
of Representatives held a hearing on March 11 on rescinding the
change made in bankruptcy law in 2005 requiring retailers in
reorganization to elect within 210 days whether to assume or
reject store leases. The National Retail Federation along with
others told Congress that the rule is forcing some retail chains
to liquidate, with the loss of jobs.
As reported by Troubled Company Reporter on March 12, U.S.
Representative Jerrold Nadler is expected to propose changes to
the Bankruptcy Code that would lift the 210-day limit for
retailers to decide which stores to keep operating. According to
Bloomberg, those in favor of an extension or the lifting of the
seven-month limit said the current law forces more companies to
consider liquidation as creditors push for quicker resolutions, as
in the case of Circuit City Stores Inc.
In April 2005, Congress revised the Bankruptcy Code to counter
abuses in the bankruptcy system. The Bankruptcy Abuse Prevention
and Consumer Protection Act of 2005 shortened debtors' time to
decide on whether to assume or reject leases to a mere seven
months, disallowed periodic extensions of the debtors' exclusive
periods to file a plan of reorganization, and limited bonuses to
managers through the key employee retention programs.
"BAPCPA's numerous creditor-friendly amendments and modifications
have profoundly impacted the Chapter 11 process, to the point that
it is nearly impossible for retailers to reorganize, regardless of
the prevailing national and international economic conditions,"
said Lawrence C. Gottlieb, Michael Klein, Ronald R. Sussman, in an
article titled BAPCPA's Effects on Retail Chapter 11s Are
Profound.
BACPCA amended Section 365(d)(4) to require debtors to assume or
reject their real property leases within 120 says of filing,
subject to an additional 90-day court-approved extension.
Extensions beyond this initial 210-day period cannot be granted
without the consent of the landlord, regardless of the size of the
retailer.
According to Bankruptcy Creditors Service, Inc., many retailers
filed for bankruptcy with a prospect for reorganizing, but ended
up closing their stores and liquidating inventory. Retailers
covered by BCSI that were unable to keep their business or sell
their business as a going concern include Circuit City Stores,
Inc., Linens 'n Things, Inc., Mervyn's LLC, Sharper Image and
Levitz.
The counterparties to these leases -- shopping centers, malls and
landlords -- plan to fight any changes to the 210-day rule, Lauren
Coleman-Lochner Bloomberg reported on March 11. The time limit,
added to the bankruptcy code in 2005, is "a firewall to keep one
retail bankruptcy from harming shopping center owners and other
retailers," said Betsy Laird, a Washington-based senior vice
president of the ICSC's global policy office. "The provisions in
2005 were the result of seven or eight years of negotiations." In
addition, the 210-day limit gives landlords flexibility in filling
vacancies, says the New York-based trade group International
Council of Shopping Centers, which wants to the time limit
retained.
Bankruptcy lawyer Harvey Miller, Esq., at Weil, Gotshal & Manges
LP, according to Bloomberg, said that the current law is "self-
defeating" for landlords "because they're going to have a lot of
shopping centers that are not going to have a tenant."
* Senate May Vote on Cramdown Bill This Month
---------------------------------------------
Karey Wutkowski of Reuters reports that legislation that would
allow bankruptcy judges to cut the mortgage debt of homeowners may
get approved this month, the head of the U.S. Senate Banking
Committee said. "We're going to try to get that adopted in the
next couple weeks," Sen. Christopher Dodd, a Democrat, told a
Consumer Federation of America conference.
A "cramdown" bill has already been approved by the House of
Representatives. House Majority Leader Steny H. Hoyer (MD) said
that the Helping Families Save Their Homes Act, which passed the
House 234-191, was necessary given that 14 million families'
mortgages are underwater, and foreclosed homes can drive down the
value of neighbors' property by nearly 10%.
"The Helping Families Save Their Homes Act puts into law some of
the most important provisions of President Obama's homeowner
stability plan, making it easier for lenders to renegotiate
mortgages for families who are underwater, close to foreclosure,
or nearing bankruptcy," Mr. Hoyer said, and for families that are
driven into bankruptcy by their home payments, this bill allows
bankruptcy judges to modify the terms of their loans-a step that
is free for taxpayers and could reduce foreclosures by 20%.
Today, investors can restructure debt on their vacation homes;
speculators can do it for their properties; and corporations can
do it for their private planes. It is only fair that average
Americans have the same right for their homes. This bill is made
for those who acted responsibly but need this breathing room
because of circumstances they could not control-circumstances like
unemployment or the nationwide decline in home values."
According to Reuters, the legislation is opposed by many banks and
investors who worry the intrinsic value of contracts would be
diminished. But advocates say the change would cut through the
red tape holding up many mortgages from being modified into an
affordable contract.
* KKR Losses Show Failure to Close Gap Raising Defaults
-------------------------------------------------------
Henry Kravis's KKR Financial Holdings LLC, a publicly traded
finance company whose shares have fallen 97% in the past year,
reported a $1.2 billion loss on March 2. The loss included
writedowns for loans held in its collateralized loan obligations
to Tribune Co., which has filed for Chapter 11.
Bloomberg recounts that Mr. Kravis, his cousin George Roberts and
Jerome Kohlberg started Kohlberg Kravis Roberts & Co. in 1976 and
were pioneers in leveraged buyouts, where investors acquire
companies mostly with borrowed money. KKR, according to the
source, participated in the largest deals, ranging from the
$31.4 billion acquisition of RJR Nabisco Inc. in 1989 to the
$43 billion purchase of Dallas-based electricity producer TXU
Corp. in 2007.
According to Bloomberg, investment funds, known as collateralized
loan obligations, purchased a majority of the lowest-rated loans
during the credit boom. However, amid an economic slowdown
dragging into its 16th month, CLOS are incurring record losses, as
borrowers are unable to pay their debts. Moody's Investors
Service, Bloomberg notes, put 760 of the funds, holding about $440
billion of assets, on review for downgrades on March 4.
According to Bloomberg, lower loan prices and companies reneging
on their debt agreements are causing losses on the CLO securities
held by banks, insurance companies and hedge funds.
Bloomberg notes that CLOs provided cash to movie-rental chain
Blockbuster Inc., which is now exploring a bankruptcy filing.
They also helped finance the $33 billion buyout of Nashville,
Tennessee-based hospital operator HCA Inc.
"The game is over," said Ross Heller, managing director at
New York-based NewOak Capital LLC, an investment and advisory
firm. "There isn't going to be money available for refinancing.
Companies will have to be put into bankruptcy and the debt
restructured." As credit losses have climbed, issuance of so-
called leveraged loans in the U.S. plummeted to $11.7 billion in
January and February from $66.3 billion in the first two months of
2008 and $158.7 billion for the same period in 2007, according to
data compiled by Bloomberg.
With the average CCC ranked loan quoted at 36.5 cents on the
dollar, 147 of 557 CLOs monitored by Wachovia Corp. are violating
terms requiring a minimum amount of collateral, Bloomberg further
reported. Four of KKR's CLOs holding about $7 billion of loans
are breaching this test and paying down senior notes, Bloomberg
added, citing a regulatory filing by the New York-based firm
March 2.
Unless policymakers decide to earmark some of the $11.6 trillion
of government programs created to combat the seizure in credit
markets to support high-yield loans, defaults may soar through
2012, Bloomberg added, citing investors.
* Peanut Recalls to Cost Producers $1 Billion
---------------------------------------------
Emily Fredrix of The Associated Press, citing a testimony by the
Georgia Peanut Commission, reported that the effects of the
widespread peanut butter recall could cost rural America's
peanut producers $1 billion in lost production and sales,
Don Koehler, the head of the GPC, told a subcommittee of the U.S.
House Committee on Small Business, that the recalls, prompted by a
salmonella outbreak tied to peanut butter, have severely hurt the
nation's peanut producers, weakening pricing and limiting their
ability to sell their products.
The Georgia Agricultural Commodity Commission for Peanuts was
established in 1961 under the Commodities Promotion Act. The
Commission conducts programs in the areas of promotion, research
and education. Funding is derived from a $2 per ton assessment on
all producers, which this year will total about $1.4 million.
Governing the Commission is a five man elected board. It is best
known in the State House by its little red bags of Georgia
Peanuts. Peanuts are a $2.0 billion industry in Georgia.
Forward Foods LLC filed a Chapter 11 petition February 17 in
Delaware after recalling 75% percent of its products on account of
using peanuts from Peanut Corp. of America
Peanut Corp. of America sent itself to Chapter 7 liquidation,
after closing its plants due to salmonella poisoning on its
products. PCA made announcements starting early January that it
was voluntarily recalling all peanuts and peanut products
processed in its Blakely, Georgia facility since January 1, 2007
because they have the potential to be contaminated with
Salmonella. The peanut butter recalled was sold by PCA in bulk
packaging to distributors for institutional and food service
industry use. It is also sold under the brand name Parnell's
Pride to those same industries. Additionally, it was sold by the
King Nut Company under the label King Nut. PCA, according to
Bloomberg, is facing a criminal investigation over eight deaths
and hundreds of sickened consumers resulting from a salmonella
outbreak.
Forward Foods announced January 30 a voluntary recall of DETOUR(R)
branded bars that contain roasted peanuts purchased from Peanut
Corporation of America (PCA). According to Forward Foods, PCA is
the focus of an investigation by the U.S. Food and Drug
Administration (FDA) concerning a recent Salmonella outbreak
thought to be caused by tainted peanut products.
* Appeals Court Says Ch. 13 Trustee May Support Secured Creditor
----------------------------------------------------------------
In the case is Overbaugh v. Household Bank NA (In re Overbaugh),
08-2355, the 2nd U.S. Circuit Court of Appeals affirmed rulings by
the bankruptcy court and a district court that a Chapter 13
trustee has standing to intervene in a claims classification
dispute between a debtor and a creditor.
Bloomberg's Bill Rochelle recounts that a debtor in Chapter 13
contested a secured claim, saying it wasn't properly perfected.
Although the creditor didn't respond, the Chapter 13 trustee
opposed reclassification of the claim as unsecured, arguing that
it was properly perfected. The bankruptcy court ruled that the
claim was secured, and the same rulings were entered on appeal.
According to Mr. Rochelle, the debtor argued that the trustee had
no right to intervene and support the secured creditor. The
Circuit Court, however, held that the trustee has standing.
The Circuit Court, Bloomberg relates, ruled on March 11 that a
Chapter 13 trustee may takes sides with a secured creditor in view
of the statutory requirement that the trustee properly disburse
estate property to holders of valid claims. Citing two other
circuits reaching the same result, the 2nd Circuit said that a
Chapter 13 trustee has a duty to "serve the interest of all
creditors," not only unsecured creditors.
* District Judge Says Civil Fines Not Barred by Automatic Stay
--------------------------------------------------------------
A bankruptcy filing triggers an injunction against the continuance
of any action by any creditor against the debtor or the debtor's
property.
Judge Ronald L. Buckwalter of the U.S. District Court for the
District of Delaware said that while the "automatic stay" under
Section 362 of the Bankruptcy Code bars actions by creditors, he
noted that the law contains an exception permitting governments to
enforce their police and regulatory powers. The judge held that a
civil suit to impose a penalty for polluting is among the type of
actions not stopped by bankruptcy.
This exception, however, did not affect the outcome. According to
Bloomberg's Bill Rochelle, Judge Buckwalter allowed W.R. Grace &
Co. to stop New Jersey environmental regulators in their tracks
because they failed to file a claim by the claims bar date and
therefore wouldn't be able to collect a fine even if they won the
suit in state court for making false statements.
According to Mr. Rochelle, the loss was the second for the New
Jersey regulators. One year ago this month, Judge Buckwalter
ruled in favor of Grace in another appeal where he held that
missing the claim-filing cutoff date by four years wasn't
excusable neglect.
About W.R. Grace
Headquartered in Columbia, Maryland, W.R. Grace & Co. (NYSE:GRA)
-- http://www.grace.com/-- supplies catalysts and silica
products, especially construction chemicals and building
materials, and container products globally.
The Company and its debtor-affiliates filed for chapter 11
protection on April 2, 2001 (Bankr. D. Del. Case No. 01-01139).
David M. Bernick, P.C., Esq., at Kirkland & Ellis, LLP, and Laura
Davis Jones, Esq., at Pachulski Stang Ziehl & Jones, LLP,
represent the Debtors in their restructuring efforts. The Debtors
hired Blackstone Group, L.P., for financial advice.
PricewaterhouseCoopers LLP is the Debtors' accountant.
Stroock & Stroock & Lavan, LLP, and Duane Morris, LLP, represent
the Official Committee of Unsecured Creditors. The Creditors
Committee tapped Capstone Corporate Recovery LLC for financial
advice. David T. Austern, the legal representative of future
asbestos personal injury claimants, is represented by Orrick
Herrington & Sutcliffe LLP and Phillips Goldman & Spence, PA.
Elihu Inselbuch, Esq., at Caplin & Drysdale, Chartered, and Marla
R. Eskin, Esq., at Campbell & Levine, LLC, represent the Official
Committee of Asbestos Personal Injury Claimants. The Asbestos
Committee of Property Damage Claimants tapped Scott Baena, Esq.,
and Jay M. Sakalo, Esq., at Bilzin Sumberg Baena Price & Axelrod,
LLP, to represent it. Thomas Moers Mayer, Esq., at Kramer Levin
Naftalis & Frankel, LLP, represents the Official Committee of
Equity Security Holders.
The Debtors filed their Chapter 11 Plan and Disclosure Statement
on Nov. 13, 2004. On Jan. 13, 2005, they filed an Amended Plan
and Disclosure Statement. The hearing to consider the adequacy of
the Debtors' Disclosure Statement began on Jan. 21, 2005. The
Debtors' exclusive period to file a chapter 11 plan expired on
July 23, 2007. Estimation of W.R. Grace's asbestos personal
injury liabilities commenced on Jan. 14, 2008.
Bankruptcy Creditors' Service, Inc., publishes W.R. Grace
Bankruptcy News. The newsletter tracks the chapter 11 proceeding
undertaken by W.R. Grace, W.R. Grace Co. - Conn. and their
affiliates. (http://bankrupt.com/newsstand/or 215/945-7000)
* Technicalities on Choice of Law on Homestead Exemption
--------------------------------------------------------
In the case is Stephens v. Holbrook (In re Stevens), 08-086, the
10th U.S. Circuit Bankruptcy Appellate Panel entered a ruling that
Iowa law, not Oklahoma's, should apply in deciding whether
proceeds from a sale of a home of an individual pre-bankruptcy was
covered by the homestead exemption, Bloomberg's Bill Rochelle
said.
According to Mr. Rochelle, before bankruptcy, the individual sold
a home in Iowa and put the net proceeds into a segregated account
in a bank in Iowa. Also before bankruptcy, the individual moved to
Oklahoma and transferred the money to a bank in that state.
The choice of law affects the outcome of the case. Iowa law
allows proceeds from a home to be exempted from creditors' claims
if held for a "reasonable" time. The Appellate Panel on March 9,
according to the report, sent the case back to the bankruptcy
judge to decide if two years is a reasonable time.
According to Mr. Rochelle, the result is ironic because a change
that Congress made to bankruptcy law in 2005, intended to prevent
an individual from moving and taking advantage of the new state's
homestead exemption, ended up helping someone who moved to a state
with a less generous exemption.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Mar. 13, 2009
AMERICAN BANKRUPTCY INSTITUTE
Bankruptcy Battleground West
Beverly Wilshire, Beverly Hills, California
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 14-16, 2009
AMERICAN BANKRUPTCY INSTITUTE
Conrad Duberstein Moot Court Competition
St. John's University School of Law, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 1-4, 2009
AMERICAN BANKRUPTCY INSTITUTE
27th Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 16-19, 2009
COMMERICAL LAW LEAGUE OF AMERICA
2009 Chicago/Spring Meeting
Westin Hotel on Michigan Ave., Chicago, Ill.
Contact: (312) 781-2000; http://www.clla.org/
Apr. 17-18, 2009
NATIONAL ASSOCIATION OF BANKRUPTCY TRUSTEES
NABT Spring Seminar
The Peabody, Orlando, Florida
Contact: http://www.nabt.com/
Apr. 20, 2009
AMERICAN BANKRUPTCY INSTITUTE
Consumer Bankruptcy Conference
John Adams Courthouse, Boston, Massachusetts
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 27-28, 2009
TURNAROUND MANAGEMENT ASSOCIATION
Corporate Governance Meetings
Intercontinental Hotel, Chicago, Illinois
Contact: www.turnaround.org
Apr. 28-30, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Intercontinental Hotel, Chicago, Illinois
Contact: www.turnaround.org
May 1, 2009
AMERICAN BANKRUPTCY INSTITUTE
Nuts and Bolts for Young Practitioners
Alexander Hamilton Custom House, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
May 4, 2009
AMERICAN BANKRUPTCY INSTITUTE
New York City Bankruptcy Conference
New York Marriott Marquis, New York City
Contact: 1-703-739-0800; http://www.abiworld.org/
May 7-8, 2009
RENASSANCE AMERICAN MANAGEMENT, INC.
6th Annual Conference on
Distressted Investing - Europe
The Le Meridien Piccadilly Hotel, London, U.K.
Contact: 1-903-595-3800 or
http://www.renaissanceamerican.com/
May 7-10, 2009
AMERICAN BANKRUPTCY INSTITUTE
27th Annual Spring Meeting
Gaylord National Resort & Convention Center
National Harbor, Maryland
Contact: http://www.abiworld.org/
May 12-15, 2009
AMERICAN BANKRUPTCY INSTITUTE
Litigation Skills Symposium
Tulane University, New Orleans, La.
Contact: http://www.abiworld.org/
May 14-16, 2009
ALI-ABA
Chapter 11 Business Reorganizations
Langham Hotel, Boston, Massachusetts
Contact: http://www.ali-aba.org
June 10-13, 2009
ASSOCIATION OF INSOLVENCY & RESTRUCTURING ADVISORS
25th Annual Bankruptcy & Restructuring Conference
The Ritz-Carlton Orlando Grande Lakes
Orlando, Florida
Contact: http://www.aria.org/
June 11-14, 2009
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa
Traverse City, Michigan
Contact: http://www.abiworld.org/
June 21-24, 2009
INTERNATIONAL ASSOCIATION OF RESTRUCTURING, INSOLVENCY &
BANKRUPTCY PROFESSIONALS
8th International World Congress
TBA
Contact: http://www.insol.org/
July 16-19, 2009
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Mt. Washington Inn
Bretton Woods, New Hampshire
Contact: http://www.abiworld.org/
July 29-Aug. 1, 2009
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Conference
The Westin Hilton Head Island Resort & Spa,
Hilton Head Island, S.C.
Contact: http://www.abiworld.org/
Aug. 6-8, 2009
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Conference
Hotel Hershey, Hershey, Pa.
Contact: http://www.abiworld.org/
Sept. 10-11, 2009
AMERICAN BANKRUPTCY INSTITUTE
Complex Financial Restructuring Program
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Sept. 10-12, 2009
AMERICAN BANKRUPTCY INSTITUTE
17th Annual Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nevada
Contact: http://www.abiworld.org/
Oct. 2, 2009
AMERICAN BANKRUPTCY INSTITUTE
ABI/GULC "Views from the Bench"
Georgetown University Law Center, Washington, D.C.
Contact: http://www.abiworld.org/
Oct. 5-9, 2009
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Desert Ridge, Phoenix, Arizona
Contact: 312-578-6900; http://www.turnaround.org/
Oct. 20, 2009
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Paris Las Vegas, Las Vegas, Nev.
Contact: http://www.abiworld.org/
Dec. 3-5, 2009
AMERICAN BANKRUPTCY INSTITUTE
21st Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 29-May 2, 2010
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 17-20, 2010
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa, Traverse City, Michigan
Contact: 1-703-739-0800; http://www.abiworld.org/
July 7-10, 2010
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Ocean Edge Resort, Brewster, Massachusetts
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2010
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Conference
The Ritz-Carlton Amelia Island, Amelia, Fla.
Contact: http://www.abiworld.org/
Aug. 5-7, 2010
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 4-8, 2010
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
JW Marriott Grande Lakes, Orlando, Florida
Contact: http://www.turnaround.org/
Dec. 2-4, 2010
AMERICAN BANKRUPTCY INSTITUTE
22nd Annual Winter Leadership Conference
Camelback Inn, Scottsdale, Arizona
Contact: 1-703-739-0800; http://www.abiworld.org/
Mar. 31-Apr. 3, 2011
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center, Maryland
Contact: 1-703-739-0800; http://www.abiworld.org/
June 9-12, 2011
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort and Spa
Traverse City, Michigan
Contact: http://www.abiworld.org/
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, California
Contact: 1-703-739-0800; http://www.abiworld.org/
The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday. Submissions via
e-mail to conferences@bankrupt.com are encouraged.
Last Updated: March 2, 2009
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com/
On Thursdays, the TCR delivers a list of recently filed chapter 11
cases involving less than $1,000,000 in assets and liabilities
delivered to nation's bankruptcy courts. The list includes links
to freely downloadable images of these small-dollar petitions in
Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland,
USA. Ronald C. Sy, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Carlo Fernandez, Christopher G. Patalinghug,
and Peter A. Chapman, Editors.
Copyright 2009. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 240/629-3300.
*** End of Transmission ***